Hispanic Investors Thirst for More Investment Knowledge and Education

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By Vittorio Hernandez | August 13, 2014 12:31 PM EST

A man reads a newspaper as pedestrians walk by outside Buenos Aires' Stock Exchange July 31, 2014. Argentina defaulted for the second time in 12 years after last-ditch talks with what it called
A man reads a newspaper as pedestrians walk by outside Buenos Aires' Stock Exchange July 31, 2014. Argentina defaulted for the second time in 12 years after last-ditch talks with what it called "vulture" creditors failed, as focus turned to whether big banks and funds would request the declaration of a "credit event". REUTERS/Marcos Brindicci (ARGENTINA - Tags: POLITICS BUSINESS)

Hispanic investors have a strong appetite for financial education and more sophisticated investment knowledge, according to a recent Wells Fargo survey. A significant 45 per cent of surveyed Hispanics claim they did not received any education on how to save and invest (versus 31 per cent of U.S. investors overall), and three out of four (76 per cent) wish they had learned more about managing money when they were growing up (compared to 61 per cent of U.S. investors overall).

Most Hispanic investors (72 per cent) stated they wish they knew more about investing in mutual funds, stocks and bonds (versus 64 per cent of U.S. investors overall).

"These findings highlight some interesting attitudes among Hispanic investors and shed light on their strong desire for more education on the fundamentals of investing," said Steve Novak, senior investment strategist, Wells Fargo Private Bank. "Our findings suggest there's an opportunity to bolster the investing confidence of Hispanics through knowledge so they can act on what they intuitively know to be true around the importance of investing for their financial futures."

Despite a strong interest in personal finance and investing, one in three Hispanic investors surveyed (34 per cent) do not feel comfortable investing in mutual funds, stocks or bonds (versus 27 per cent among U.S. investors overall). However, if they did invest in stocks and bonds, most Hispanics surveyed (70 per cent) felt they would earn money on those investments (12 per cent feel they would lose money, and 18 per cent feel they would break even).

Additionally, survey responses indicate Hispanic investors are far more risk-averse than others, with almost half (47 per cent) preferring to put money for the future into savings with no risk of losing it (compared to 35 per cent of U.S. investors overall). More than half (56 per cent) of Hispanic investors feel that the best place to keep their savings is in bank accounts (38 per cent) or real estate (18 per cent). In contrast, fewer than half (45 per cent) of all U.S. investors feel that the best place to keep their savings is in bank accounts (32 per cent) or real estate (13 per cent).

One in ten (10 per cent) Hispanic investors give themselves an "A" when it comes to their financial and investing literacy (versus 17 per cent among U.S. investors overall). Half of Hispanic investors (47 per cent) give themselves a grade of "B," and another third (34 per cent) give themselves a "C" (similar to U.S. investors overall).

Strong Connection to Family and Community

Family dynamics play a significant role in how Hispanic investors think about their personal finances and financial future. This is true in terms of lessons learned about money growing up, a sense of responsibility for taking care of family members financially and how they think about their future retirement.

Fifty-five percent of Hispanic investors agree that "raising and investing in kids is the best retirement plan," compared to 41 per cent among U.S. investors overall, and one quarter (24 per cent) expect to rely on family members to live and make ends meet in retirement, compared to 13 per cent of U.S. investors overall.

Hispanic investors are also more likely than other investors to lend and borrow money within their families. Almost 60 per cent provide financial support to others in their families or communities, compared to 44 per cent of U.S. investors overall, while half (54 per cent) have lent or given money to an adult family member in the last year, compared to 39 per cent of U.S. investors overall. Of those providing financial support to others, 81 per cent provide direct financial support by giving money or paying bills. Thirty-one percent of Hispanic investors are supporting adult children, parents, grandparents, extended family, or others, compared to 26 per cent of U.S. investors overall, and 6 per cent are providing financial support for people who live outside the U.S. (compared to 1 per cent of U.S. investors overall).

Among Hispanic investors with kids, 28 per cent say they want their kids out of the house and on their own the day they turn 18 (same as U.S. investors overall). Fifty-nine per cent say they want to have money to pass on to family or friends (similar to U.S. investors overall), and 17 per cent say that wanting assets for an inheritance most motivates them to build up their savings and investments (compared to 8 per cent of U.S. investors overall).

Conversations with Parents

Nearly all Hispanic investors polled (92 per cent) say their parents talked "a lot" or "sometimes" about the value and importance of hard work when they were growing up (similar to 89 per cent of U.S. investors overall), but fewer than half said their parents talked as much about financial issues, including:

  • How they managed money and spending (45 per cent, similar to 40 per cent of U.S. investors overall)
  • What they were saving for and how much (36 per cent, similar to 31 per cent of U.S. investors overall)
  • How they were planning for retirement (29 per cent, similar to 33 per cent of U.S. investors overall)
  • How much money they made (27 per cent, higher than 19 per cent of U.S. investors overall)

Dr Joseph Louro, chief executive officer of Red Bank, New Jersey-based investment education company InvestView (OTCQB: INVU) commented that investment education is important to better understand market trends and make money from investment opportunities.

Louro said in the company Web site, "It is our opinion that now, more than ever before, it is critical that the individual investor come to understand the forces that influence the marketplace. We specialize in assisting common investors through this process by offering them the tools, training and confidence that is required to successfully navigate the market in these trying times."

InvestView, Inc. provides and delivers a comprehensive online program of investor education: proprietary investor search tools and trading indicators, weekly newsletters as well as access to live weekly Trading Rooms. It delivers subscription-based financial education courses through InvestView's website. InvestView also allows new retail investors to use the portal's subscribed information on a 2-week trial period for $9.95.

The company does it through its online education, analysis and application platform that provides analysis, tools, education solutions and an application. InvestView's web-based tools were designed to simplify stock research and improve the investor's research efficiency. One such tool is the Market Point, which is made up of five sections, namely: Charts, Stock Watch, Market, Calendar and Campus.

InvestView offers five training courses that provide an incredible education in the stock market. The five InvestView courses build upon each other. Beginners should take them in the suggested sequence, while more seasoned traders may jump right into the more advanced topics that they are craving to better understand and give them the edge as a successful trader. Each course is offered via live webinar and as a recorded on-demand videos that is immediately posted at the end of each webinar. For more information, please visit their web site.

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(Photo: / )
A man reads a newspaper as pedestrians walk by outside Buenos Aires' Stock Exchange July 31, 2014. Argentina defaulted for the second time in 12 years after last-ditch talks with what it called "vulture" creditors failed, as focus turned to whether big banks and funds would request the declaration of a "credit event". REUTERS/Marcos Brindicci (ARGENTINA - Tags: POLITICS BUSINESS)
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