Manulife Quarterly Investor Sentiment Index: National poll suggests mutual funds, equities on rebound (January 10, 2001)
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FOR IMMEDIATE RELEASE
January 10, 2002


Manulife Quarterly Investor Sentiment Index:
National poll suggests mutual funds, equities on rebound

Waterloo – Canadians were showing signs of renewed confidence in mutual funds and equities toward the end of 2001, after turning to traditionally safe havens in the wake of the Sept. 11 terrorist attacks in the United States, suggests a national poll conducted for Manulife Financial, one of Canada’s leading insurance companies.

The latest regular quarterly poll for Manulife conducted in December suggests many Canadians felt more confident in equity markets than just three months earlier.

“Canadians generally were looking for capital security during the weeks immediately after the terrorist attacks, but now we’re seeing signs of more confidence in equity markets and mutual funds,” said Bruce Gordon, Manulife's Executive Vice President of Canadian Operations. “The positive perception of mutual funds and equities that was clear in the index earlier in 2001 seems to be on its way back.”

Mr. Gordon said the latest quarterly poll, first launched by Manulife three years ago, likely reflects growing confidence in the market as world events progressed. “Manulife offers a range of financial services to more than 3.5 million Canadians, said Mr. Gordon. “This index helps us to better understand how Canadians in general can be affected by changes in the overall economy and how we might best adapt to those changes.”

Balanced funds, stocks show strong rebound
The overall winter 2001 Manulife Investor Sentiment Index, based on a mid-December survey of 1,001 Canadians by Thompson Lightstone & Company, decreased slightly to a new low of +11, down from +16 in mid-September. That result partly reflects a shift from traditionally safer havens of real estate, fixed income and cash. The quarterly index monitors how Canadians say they feel about 10 different investment categories and vehicles. The index for each individual category or vehicle reflects the percentage of those surveyed who say they believe it is a good or very good time to invest -- minus the percentage who say it is a bad or very bad time to invest.

“This is an important time for investors to work closely with their advisors, who can take the time to assess their needs and help them plan for long-term futures, including a review of their guaranteed versus variable products,” Mr. Gordon said.

Double-digit increases for balanced funds, equities
Among six investment categories, equities and balanced funds showed double-digit increases in their indices, while those polled also showed relative confidence in segregated funds, RRSPs and RESPs. Fixed income and real estate investments, including their own homes (mortgages and renovations) declined in the latest poll to their lowest levels in three years. Cash -- the only area to increase in strength during the previous poll in September -- fell sharply in the most recent poll.

Highlights
The following six investment categories comprise the Manulife Investor Sentiment Index:
  • Investing in their own homes (either renovations or mortgages) remains the most popular investment for Canadians. Traditionally the favourite of six investment categories, investing in their own homes eased 16 points to +41 in December. The index reflects 58 per cent of those surveyed who said it’s a good or very good time to invest in their homes, minus the 17 per cent who believe it's a bad or very bad time.
  • Real estate other than their own homes was the next most popular investment, climbing seven points to +27, partly reflecting the competitive market for mortgage interest rates.
  • Balanced funds climbed 16 points to +18. Almost half (44 per cent) viewed balanced funds as a good or very good place to invest in December, compared to 26 per cent who felt the opposite.
  • Fixed income investments (including GICs, annuities) dropped 19 points to +1 in December, down sharply from +33 in mid-2001, likely reflecting current low interest rates plus increased confidence in equities and mutual funds.
  • Concerns about stock markets after the Sept. 11 attacks drove the index for equity holdings into negative territory for the first time in September, but it rebounded 14 points to –4 in December. The latest survey found more than a third (36 per cent) considered it a good time to invest in stocks, either directly or via mutual funds, while 40 per cent said they still saw equities as a bad choice. Some 15 per cent felt it was neither a good or bad time to buy stocks.
  • Cash (including savings accounts) reached its lowest point yet since the index was launched, falling 30 points to -16 in December.

Investment Vehicles
As well as evaluating the six investment categories above, the same question was asked of four investment vehicles.
  • Registered Retirement Savings Plans, traditionally the most popular investment vehicle in all previous surveys, was tied for first this time at +47 points, up four points from September. The index reflects 63 per cent of respondents who feel it's a good or very good time to put money into RRSPs, while 16 per cent said it was a bad time.
  • Interest also rose slightly in Registered Education Savings Plans, which rivalled RRSPs in popularity for the first time in three years as more Canadians became aware of federal changes to RESP contributions and withdrawals. The index for RESPs reached +47 points in December, up seven points from three months earlier.
  • Mutual funds registered the biggest rebound among investment vehicles, climbing back 16 points to +18 in mid-December. Forty-two per cent of Canadians surveyed thought mutual funds were attractive, while 24 per cent said it remained a bad or very bad time to place their money in funds.
  • The index for segregated funds registered a marginal decline of two points to +19, leaving segregated funds as positive as mutual funds among those surveyed.

The poll by Thompson Lightstone was conducted with 1,001 Canadians aged 18 and older between December 6 and December 12, 2001. The results have a margin of error of +/- three per cent, 19 times out of 20.

About Manulife Financial
Manulife Financial is a leading Canadian-based financial services company operating in 15 countries and territories worldwide. Through its extensive network of employees, agents and distribution partners, Manulife Financial offers clients a diverse range of financial protection products and wealth management services. Funds under management by Manulife Financial (Manulife Financial Corporation and its affiliated companies) were Cdn$134.6 billion as at September 30, 2001.

Manulife Financial Corporation trades as ‘MFC’ on the TSE, NYSE and PSE, and under ‘0945’ on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com.

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Media contact:
Tom Nunn
Director, Media Relations
Manulife Financial
519-594-8578
tom_nunn@manulife.com



Manulife Investor Sentiment Index - Winter 2001
Index Scores: % saying it's a good time to invest minus % saying it's a bad time to invest



Index Scores: % saying it's a good time to invest minus % saying it's a bad time to invest





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