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Investors, especially millennials, have unrealistic expectations about annual returns: study

June 17, 2016

 

 


Investors, especially millennials, have unrealistic expectations about annual returns: study

The average stock market yield globally is only 3.8%, but Americans expect 11% annually

Jun 16, 2016 @ 11:21 am | By Bloomberg News

Incredibly optimistic. That’s the attitude of investors around the world toward the minimum annual income they want from their investments.

The average expectation in a recent survey: 9.1%. Americans and millennials set the bar highest, at 11.1% and 10.2%, respectively.

The average stock market yield globally: 3.8%. And benchmark interest rates in major developed markets are at 0.5% or lower — or negative.

The expectations of financial advisers also appear high, according to the new global investor study by asset manager Schroders. The study, which surveyed 20,000 investors across 28 countries, found that advisers around the globe wanted to generate a minimum of 7.9% a year for clients — lower than what the investors wanted but still high given the low interest rates. U.S advisers cited 5% as their target for annual investment income.

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Steve Siepak
Blue Vault session at the recent National Planning Holdings National Conference
September 13, 2017

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