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Manulife Investor Sentiment Index gains ground as Canadian investors show stronger interest in real estate, segregated funds and RESPs Waterloo - The spring 2001 Manulife Investor Sentiment Index suggests Canadians are in full pursuit of real estate this spring as they look for safe havens for their investments, according to a Gallup poll commissioned by Manulife Financial, a leading provider of insurance and investment services. “This is the sharpest swing toward real estate that we’ve seen in two years of asking Canadians what they favour for their investments,” said Bruce Gordon, Manulife's Executive Vice President of Canadian Operations. “If there’s a spot where more Canadians seem extremely confident this spring, it’s investing in their own homes and that should bode well for the overall economy.” Rebound in investor sentiment index 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 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. The spring 2001 Manulife Investor Sentiment Index, based on a mid-March survey of 1,003 Canadians by The Gallup Organization, rebounded by four points to +28, amid considerable stock market volatility and competitive interest rates. “Throughout much of last year, we saw investor uncertainty reflected in the index, particularly around equity markets and even real estate late in the year,” said Mr. Gordon. “Now we’re seeing a strong interest in real estate, which is traditionally a leading economic indicator.” Segregated funds, RESPs gain ground Of 10 areas/vehicles of investment, interest in real estate, segregated funds and RESPs gained the most ground in the past three months, as the overall index gained four points from mid-December. Despite volatile markets and industry experience with softer RRSP and mutual fund sales this year, Mr. Gordon said the index could indicate stronger investor confidence still lies ahead, similar to what was witnessed a year ago -- particularly if Canadians continue to show confidence in real estate and other long-term investments. Of six investment categories measured for the index, investing in their own homes (including mortgages) reached a new high, while investment real estate also rebounded sharply. Highlights The following six investment categories comprise the Manulife Investor Sentiment Index: Investing in their own homes (either renovations or mortgages) shot to a new high as the most popular investment for Canadians. Traditionally the favourite of six investment categories, investing in their own homes climbed a full 15 points amid recent competitive mortgage interest rates, to an index of +64, up from +49 in December. (The index reflects 73 per cent of those surveyed who said now is a good or very good time to invest in their homes, including paying down their mortgage, while only nine per cent think it's a bad or very bad time.) Investing in real estate other than their own homes, also climbed a full 15 points to +27 in March, up sharply from just three months ago. Balanced funds remained the second-favourite target for investors, among specific investment categories, registered at +31 points. Recent market volatility helped to keep fixed income investments steady at +31 points, identical to mid-December. Concerns about stock markets continued in March. This category was rated at +10 points, its lowest point in two years and off sharply from +33 points in September and a high of +40 last June. In the March survey, less than half (41 per cent) said it’s a good time to invest in stocks, either directly or in mutual funds, while 31 per cent surveyed said they saw equities as a bad choice. Cash (including savings accounts) barely remained in positive territory after staying out of favour with most Canadians since the index was launched. (Its index was +1 in March, down from +4 points in December). As well as evaluating the six investment categories above, the same question was asked of four investment vehicles. Registered Retirement Savings Plans remained the most popular investment vehicle in the Manulife/Gallup survey at +62 points, steady with the December survey, despite a softening of sales experience in the industry from a year ago. The index reflects 74 per cent of respondents who feel it's a good or very good time to put money into RRSPs, while 12 per cent say it's a bad time. Interest in Registered Education Savings Plans reached a new high at +55 points, up 13 points from December. For the first time in two years, the index for segregated funds surpassed mutual funds and reached +40 points, up 10 points from the latest survey. Mutual funds fell to a new low of +28 points, down from a high of +48 in mid-2000 and down six points from December. Half of Canadians surveyed think mutual funds are attractive now, but 22 per cent say it's a bad time to place their money in funds. The survey asked Canadians about their views toward investing in a range of investments and investment vehicles. Gallup polled 1,003 Canadians aged 18 and older between March 12, 2001 and March 18, 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$123.5 billion as at December 31, 2000. Manulife Financial Corporation trades as ‘MFC’ on the TSE, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com. -- 30 -- For more information or to arrange an interview with Mr. Gordon, please contact: Tom Nunn Director of Media Relations Manulife Financial (519) 747-7000, ext. 8578 fax: (519) 747-6336 tom_nunn@manulife.com Index Scores: % saying it's a good time to invest minus % saying it's a bad time to invest
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