By IR Web Report Staff
ALMOST one in three investors who use online brokerages select their investments based on whether they use a particular product or company service, according to the 2006 Scottrade American Investor Study.
The study also found that 28% of online investors select investments based on a company or product they have heard or read about.
The study polled 1,888 active investors who use either or both full service and online brokers.
The study found that online investors have a “voracious appetite” for information, wtih 72% using online research to select their investments compared to just 43% for full service investors.
Furthermore, 19% of online investors select investments based on recommendations from financial programs on television, compared to 12% of full service investors.
Meanwhile, 17% of online investors select investments based on recommendations from financial programs on radio, compared to just 5% of full service investors.
“Online investors use every option available to them, with more frequency, to make their own personal investment decisions,” said Chris Moloney, Chief Marketing Officer at Scottrade, Inc., the online brokerage firm. “Brand awareness and corporate identity are very important factors influencing investment decisions.”
Although 54% of investors get their financial news and information from financial Web sites, traditional media, especially newspapers, remain key resources. The survey found that 43% of investors get financial news and information from local newspapers while 32% use magazines.
Media consumption by income also plays a role in how investors select investments. Scottrade found that 37% of investors with household income between $100,000 and $150,000 select investments based on recommendations from financial newspapers and magazines compared with 25% of investors with household incomes between $35,000 and $100,000.
Investors with incomes over $150,000 are also more likely to seek news and information from financial Web sites, radio and magazines than lower household income investors.
“The abundance of financial news sources has made investing easier and less challenging.” said Moloney. “For active traders, the efficiency of gathering news and getting it fast has made online trading faster than what most full-service brokers can offer.”
The 2006 American Investor Study was commissioned by Scottrade and conducted online with members of the e-Rewards Market Research consumer panel.
Fielded with a nationally representative sample of 1,888 respondents between May 3 and May 9, 2006, the study examined attitudes, behaviors and trends related to investing. All participants were at least 18 years of age and either shared responsibility in making financial decisions or were the sole financial decision makers in their households.
For purposes of the study, “investors” are defined as having $500 or more currently invested with either a full-service or online brokerage firm. Margin of error for the overall poll is +/- 3 percent.
Technorati Tags: Investor Relations
Dominic (bio & disclosures) is IR Web Report‘s founder and an online investor relations consultant. He advises leading public companies and investor relations service providers worldwide on using the web for disclosure, engagement and profile building. You can contact him via the contacts page.
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