Majority of Investors Believe Investing Has Become More Challenging

Appetite for Active Management and Financial Education Strong

Investor Satisfaction with Advisors High

Janus Henderson Investors today released the findings of its Investor Survey: Insights for a Brighter Future, which seeks to better understand how individual investors are navigating the ever-changing market environment. The results reveal the current political landscape is a significant source of anxiety, as 49% of investors surveyed are very concerned about the impact the 2024 U.S. presidential election will have on their finances; surpassing more immediate developments including persistent inflation (35%), risk of recession (29%), rising interest rates (27%), and poor stock market performance (20%).

The survey was conducted among 1,000 mass affluent and high-net-worth investors with $250,000 or more in investable assets to understand their mindset amid a challenging political climate, volatile market, and unsettled economic environment.¹

On the eve of a potentially tumultuous election year against uncertain interest rates and economic backdrop, investors are naturally fearful. These fears run headlong into what seven out of 10 investors believe is an increasingly challenging market. Given this uncertainty, it is perhaps not surprising that just as many investors feel anxious about their finances (34%) as feel very confident in achieving their goals (36%).

Notably, older investors are more concerned about the election than younger investors. Nearly 7 in 10 (69%) members of the Silent Generation (ages 75+) are very concerned about the 2024 US Presidential election compared to just 37% of Millennials (ages 25-40).

“Despite investors’ concern about the 2024 U.S. Presidential election, results haven’t historically been a reason to exit the capital markets,” said Matt Sommer, Head of Specialist Consulting Group at Janus Henderson Investors. “In fact, looking back at S&P 500 returns from 1937 through 2022, the average annual return was 9.9% in presidential election years, and 12.5% in nonelection years.”

Investors Navigating Challenging Markets with Active Management, Continuous Learning

With 71% of investors reporting that investing has become more challenging over the past few years and nearly as many (61%) indicating that the cost of living is rising faster than their income and investments, demand for active management and financial education is strong.

Among respondents who own mutual funds or ETFs, 66% want active funds in their portfolio – with 29% preferring mainly active funds and 37% preferring an equal mix of active and passive funds. Less than one-in-five investors (17%) prefer mainly passive funds, 12% have no preference, and 4% were unsure. The preference for active management is associated with having a financial advisor, as 34% of investors with an advisor prefer mainly active funds compared to 18% of investors without a financial advisor.

“The active versus passive discussion has evolved beyond an either-or decision for the benefit of all investors,” added Sommer. “With the prospect of higher-for-longer interest rates casting a shadow over future economic growth, investors are increasingly turning toward active management to mitigate risk in their portfolios and differentiate between good and bad companies as higher capital costs create new competitive challenges.”

Across all generations, investors’ appetite for improving their financial know-how is strong, as 86% of investors are very interested or somewhat interested in increasing their financial knowledge. A desire to learn was particularly robust among younger investors – 96% of both Millennials and Gen-Xers express meaningful interest in improving their financial education.

Financial Advisors Delivering for Clients Near and Far, From in Room to on Zoom

Among investors working with a financial advisor, 65% are very satisfied with the quality of the relationship, 33% are somewhat satisfied, and just 2% are dissatisfied. Further, those working with an advisor are more likely to be very satisfied with their financial situation (52%) than those without an advisor (40%).

The primary traits of financial advisors for clients who report they are very satisfied with the relationship include:

• Provides peace of mind that I'm on track to reach my goals (69%)
• Cares about me as a person, beyond just my financial situation (61%)
• Provides financial education / makes me smarter (56%)

With advances in technology reshaping advisor-client communications, the survey found no relationship between respondents’ high levels of satisfaction and residing near their financial advisor (vs. out-of-state). In fact, while most investors (70%) report their advisor is based in the same state, 73% say they would be comfortable working with an advisor that is based out of state.

Among the ways in which investors have communicated with their advisor over the past six months, telephone (68%), in-person (54%) and email (53%) were the most common methods. Just 28% of investors report interacting with their advisor by video conference, however, the majority (52%) say they would be comfortable using video conference technology to speak with their financial advisor.

For Millennials, nearly half (49%) are not comfortable interacting with their financial advisor by telephone.

“As video conferencing becomes more entrenched in our everyday lives, geographical barriers are being diminished, providing advisors with an opportunity to tap into a much broader circle of friends, family members, entrepreneurs, and successful professionals as potential clients or referral sources,” said Sommer. “Investing in technology that delivers a seamless and frictionless experience for clients and prospects will be pivotal for future growth.”

To download a copy of Janus Henderson Investors’ Investor Survey: Insights for a Brighter Future report, click here.

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Notes to editors

About the Survey

Janus Henderson Investors’ Investor Insights Survey was conducted by 8 Acre Perspective among 1,000 investors nationwide with $250,000 or more in investable assets. The survey was conducted from July to August in 2023.

About Janus Henderson

Janus Henderson Group is a leading global active asset manager dedicated to helping clients define and achieve superior financial outcomes through differentiated insights, disciplined investments, and world-class service.

As of September 30, 2023, Janus Henderson had approximately US$308.3 billion in assets under management, more than 2,000 employees, and offices in 24 cities worldwide. Headquartered in London, the company is listed on the NYSE and ASX.

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Janus Henderson survey finds 49% of investors are very concerned about the impact the 2024 U.S. presidential election will have on their finances