Canadians go with their heart when it comes to investing, survey shows
November 28, 2012
The Bank of Montreal in Canada asked its customers how they invest their money and what their decision-making process is. The majority of respondents reported they follow their heart, according to The Canadian Press.
The BMO Psychology of Investing Reports survey showed that two-thirds of the 1,000 Canadian respondents said they usually cannot keep their emotions out of a deal and have also made an investment simply on impulse, according to the news source. The most common emotion that triggered these individuals to make an investment included fear, anticipation and trust.
Even though some felt as though they were confident with their impulse investments, other Canadians were unaware of the investment process and as a result, did not feel comfortable making one, the media outlet reports. Approximately 44 percent said they were uneasy when it came to making an investment and only 25 percent took the time to do their research before they considered investing.
The survey also looked at how the respondents viewed their own personal finances, as a previous report showed that 60 percent of Canadians impulse shop or make decisions in an effort to improve their mood. This cost respondents about $3,720 annually, the publication reports.
It seems as though the majority of Canadians are not taking the proper steps to ensure they are making the right move before they do so, and that is not the way many should invest.
"While we're only human, wise investing means more than simply following your heart," Serge Pepin, the vice president of investment strategy at BMO Asset Management Inc., told the news source.
Pepin also shared that there are a number of places in which these respondents can seek out financial advice before making any impulsive decisions. The report also looked to see if Canadians felt as though they were investing enough, and 41 percent believed they were not. In addition, 90 percent said they don't have enough money to invest, whereas 83 percent explained they wanted to pay off their debt first, according to the news outlet.