Canadians invest conservatively

The rest breaks down as follows:

• Canadian stocks and stock mutual funds (34%);
• Canadian bonds and bond mutual funds (13%);
• foreign stocks, bonds and mutual funds (12%);
• ETFs (5%); and
• other (11%).

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“To the extent that foreign exposure is indicative of an investor’s risk appetite (and often his or her understanding of the importance of diversification), the 12% average holdings of foreign stocks, bonds and mutual funds is noteworthy,” the survey states.

Just 16% of investors plans to invest more in foreign assets over the next year. More than half (57%) say no and 26% either don’t know or aren’t sure.

Read: Canadians postpone retirement

Investors who plan to take on more global exposure say they’ll do so because:

• foreign investments add valuable diversification to their portfolio (62%);
• foreign investments offer the potential for higher returns (61%);
• the Canadian economy is weak (39%);
• their financial advisor recommends foreign investments (22%); and
• Canadian investments are too risky (13%).

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Of those who don’t plan to add foreign investments, they say it’s because:

• they prefer investments to be in Canadian dollars (39%);
• the global economy is weak (32%);
• foreign investments are too risky (20%);
• it’s too difficult to research global investment opportunities (13%); and
• their financial advisor doesn’t recommend them (10%).

The report also finds investors have a positive view about their personal finances over the next five years.

More than half (52%) are either very optimistic (14%) or somewhat optimistic (38%) about their financial future. Twenty-six percent take a neutral view, 18% are somewhat pessimistic and 4% are very pessimistic.

Also read:

• Top 3 retirement realities for boomers
• Canadians pay down debt first despite retirement concerns
• Older Canadians share financial lessons