Manulife quarterly investor sentiment index rises: National poll suggests strong interest in fixed income, cash and balanced funds

WATERLOO, ON, July 23, 2002 – Canadians say they are playing it
safer
with their savings this summer as they shift toward more
conservative
investment vehicles, according to a national poll conducted for
Manulife
Financial, among Canada’s leading insurance and wealth management
companies.

The 14th regular quarterly poll for Manulife, conducted in
mid-June,
recorded a slight increase in investor sentiment with more Canadians
showing
higher interest in fixed income investments, cash and balanced
funds, compared
to three months earlier. Three of 10 categories in the survey gained
ground,
while another four showed marginal declines from the last previous
poll in
mid-March.

“Our latest survey suggests slightly more Canadians are leaning
toward
traditionally ‘safer’ places for their money, particularly in light
of even
more recent market events reflecting corporate governance cases
affecting
equity markets,” said Bruce Gordon, Manulife’s Executive Vice
President of
Canadian Operations. “But the positive gain in the overall Manulife
Investor
Sentiment Index could bode well for investors taking a
‘portfolio-approach’
over the long term.”

Mr. Gordon said the latest survey, initially launched three
years ago,
reflects recent concerns raised by cases such as Enron and WorldCom,
despite
considerable strength in the overall North American economy.
“Manulife offers
a wide range of financial services and products to more than 3.5
million
Canadians and the Index helps us gauge what Canadians are generally
saying
about where they favour investing in the economy.”

Fixed income, cash, balanced funds show gains

The overall Summer 2002 Manulife Investor Sentiment Index, based
on a
mid-June survey of 1,002 Canadians by Thompson Lightstone &
Company, climbed
two points to +23. The quarterly index monitors what Canadians say
they feel
about 10 different investment categories and vehicles. The index
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.

“At times like these, investors need to work closely with their
advisors,
who can help them assess their needs and plan for long-term goals —
including
a review of their guaranteed versus variable products,” Mr. Gordon
said.

Double-digit increase for fixed income, stability to RRSPs,
RESPs,
segregated funds

Among six investment categories in the survey, indices climbed
for fixed
investments, cash and balanced funds. Among investment vehicles,
RESPs, RRSPs
and segregated funds generally held their ground. After soaring near
record
highs earlier this year, investing in real estate (including their
own home
mortgages, renovations and investment properties) eased slightly,
while stocks
and mutual fund indices reflected uncertainties in equity markets.

Highlights

The Manulife Investor Sentiment Index is determined by the
following six
investment categories:

  • 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 home
    eased five
    points (after climbing 17 points in mid-March) to +53 in June.
    The
    index reflects 66 per cent of those surveyed who said it’s a
    good
    or very good time to invest in their homes, minus the 13 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, but decreased by six points to +37, partly
    reflecting
    current trends in mortgage interest rates.

  • Balanced funds climbed three points to +24 in June. Almost
    half
    (45 per cent) of those surveyed said balanced funds are a good
    or very good place to invest, compared to 21 per cent who felt
    the opposite.

 

  • Fixed income investments (including GICs, annuities) rose
    sharply
    by 15 points to +18 in June, reflecting recent increases in
    interest
    rates.
  • Concerns about stock markets after the Sept. 11, 2001
    terrorist attacks
    drove the index for equity holdings into negative territory
    for the
    first time last September, but it had rebounded 14 points to
    -4 in
    December and back into positive territory in March, at +4. It
    remained
    at +3 in June. A third (33 per cent) of those surveyed in
    mid-June
    considered it a good time to invest in stocks, either directly
    or
    via mutual funds, while 30 per cent said they still view
    equities
    as a bad choice. Some 22 per cent felt it was neither a good
    nor bad
    time to buy stocks.
  • Cash (including savings accounts) also jumped sharply by nine
    points,
    but remained among the weakest destinations for investors. The
    index
    for cash registered at +3, reflecting 39 per cent who said
    it’s a good
    or very good time to have money in cash, compared to 36 per
    cent
    leaning the opposite direction.

Investment Vehicles

As well as evaluating the six investment categories above, the
same
question was asked of four investment vehicles.

  • Registered Retirement Savings Plans remained the traditionally
    most
    popular investment vehicle by easing only one point from the
    previous
    survey. The index of +53 for RRSPs reflects 67 per cent of
    respondents
    who feel it’s a good or very good time to put money into RRSPs
    while
    14 per cent said it was a bad time in mid-June.
  • Interest climbed slightly in Registered Education Savings
    Plans, which
    rivalled RRSPs in popularity in December for the first time in
    three
    years. The index for RESPs rose one point in June, to +45,
    from three
    months earlier.
  • Following a strong rebound in March, mutual funds registered
    the
    largest decline in consumer interest in June, easing seven
    points.
    While year-over-year mutual fund sales were down sharply in
    June,
    the index for mutual funds now stands at +23. Some 45 per cent
    of
    those surveyed said it was a good or very good time to invest
    in
    mutual funds, while 22 per cent said it was a bad or very bad
    time
    to invest their money in mutual funds.
  • Segregated funds registered a marginal decline of one point in
    its
    index, to +15, with 40 per cent of those surveyed saying it’s
    a good
    time to invest in segregated funds compared to 25 per cent
    stating
    the opposite.

The poll by Thompson Lightstone was conducted with 1,002
Canadians aged
18 and older between June 13 and June 20, 2002. The results have a
margin of
error of +/- three per cent, 19 times out of 20.

To view the Manulife Investor Sentiment Index – Summer 2002,
please
visit: http://files.newswire.ca/16/Investor_Sentiment.doc

About Manulife Financial

Manulife Financial is a leading Canadian-based financial
services group
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
were
Cdn$146.7 billion as at March 31, 2002.

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