What Types Of Investments Cause Investor Complaints



What Types Of Investments Cause Investor Complaints?

If you answered "annuities", you couldn't be any more off base...

"Smart Money" Magazine just came out with an article that highlighted the different types of investments that caused the most complaints from investors.  They got their information straight from the horse's mouth, FINRA, the organization that handles investor complaints.

It didn't tell me anything I didn't already know.  Twenty years working as a full service advisor has taught me plenty about how assets truly perform. However when most consumers read it, they couldn't have been more shocked!

Here's the list of types of investments that investor's complained about in 2009 (through September 30) along with the number of complaints:

1. Mutual Funds - 1272

2. Stocks - 1053

3. Preferred Stocks - 386

4. Bonds - 208

5. Annuities - 93

Many couldn't believe it!  They can find article after article that tells us to avoid annuities, yet how many articles do you find that tell you to avoid stocks or mutual funds, the two biggest investment options complained about this year?

The one asset that the media tells us to avoid is the one least complained about this year!  Both mutual funds and stocks have gotten 10 times the complaints this year over annuities, so why are we seeing articles written about that?

Plus, if you go to FINRA's website (), you'll find investor alerts telling you to avoid annuities.  Yet based on the list above, shouldn't they instead be writing investor alerts on stocks and mutual funds?

It sure makes you want to scratch your head and wonder what's going on, doesn't it?  I suspect that it goes back to a simple truth.

People seem to get an idea in their minds, and it takes over.  It doesn't matter how accurate the idea is, they simply choose to believe it regardless of whether or not it's true.

It's often referred to as "the madness of crowds".  It's the same thing that drives all asset bubbles to crazy heights.

The bottom line is this.  All investments are neither good or bad.  They are simply tools.  When you use them properly, you'll be happy.  When you use them improperly, you won't.

It's really as simple as that.

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