DECEMBER 2016

Investors in the United States 

2016
Investors in the United States 2016

1

Contents

Introduction	2

Research Findings	3

Profile of Investors3

Investing Behaviors4

Brokers/Advisors6

Investment Fees9

Attitudes Toward Investing 11

Disclosures 13

Information Sources 15

Investor Literacy 17

Conclusion	 20

Background and Methodology	 21

Authors	 22

Acknowledgments	 22
Investors in the United States 2016 2

Introduction

The National Financial Capability Study (NFCS) is designed to measure perceptions, attitudes, experiences, 

and behaviors on a wide variety of topics. The largest component of the NFCS, the State-by-State Survey, 

is conducted across a large, diverse sample in order to provide a comprehensive analysis of the financial 

capability of the national population as a whole. As such, the breadth of subject areas covered in the Stateby-State Survey necessarily limits the depth to which any individual subject can be explored, particularly in 

areas such as investing outside of retirement accounts, which applies to only a minority of the population. To 

provide more insight on investing decisions, a separate follow-up survey of investors was conducted as part of 

the 2015 NFCS. The Investor Survey explores topics such as relationships with investment brokers and advisors, 

understanding and perceptions of fees charged for investment services, usage of investment information 

sources, attitudes towards investing in general, and investor literacy.

This report1 outlines findings from the 2015 Investor Survey, an online survey conducted among a sample of 

2,000 respondents2 who completed the 2015 State-by-State Survey and indicated that they have investments 

held in non-retirement accounts. A large majority of these respondents (87%) also have investments in 

retirement accounts, though retirement investments are not specifically addressed in the survey.

Please note that all of the data collected in this survey are self-reported by the respondents themselves 

and are not independently checked or corroborated by other sources (e.g., account statements, follow-up 

interviews with third parties). Therefore, while the survey can be reasonably assumed to present an accurate 

reflection of investors’ opinions, beliefs, knowledge, and attitudes, it does not necessarily present a precise 

reflection of behaviors or of the valuations of assets and liabilities.

1. Percentages shown in this report may not always add up to 100% due to rounding and/or “Don’t know” and missing responses.

2. Selected findings are also presented for sub-samples (e.g., by those who use a financial advisor vs. those who do not, etc.). In all such 

cases, each sub-sample consists of at least 100 respondents or more.

0 The Investor Survey explores topics such as

relationships with investment brokers and advisors,

understanding and perceptions of fees charged for

investment services, usage of investment information

sources, attitudes towards investing in general, and

investor literacy.
Investors in the United States 2016 3

Research Findings

Profile of Investors

Individuals with non-retirement investment accounts constitute less than a third (30%) of the national adult 

population.3, 4 Comparing the demographics of Investor Survey respondents to national estimates from the 

2015 NFCS State-by-State Survey, we see that investors differ from the overall population in some important, 

but not surprising, ways. Investors are slightly more likely to be male, and considerably more likely to be older, 

white, and college educated. Predictably, investors are likely to have higher incomes than the population 

at large. Three-quarters of respondents in the Investor Survey have household incomes of $50,000 or more, 

compared to just under half (49%) of State-by-State Survey respondents.

3. Source: 2015 NFCS State-by-State Survey.

4. A large majority of these investors (87%) also have investments in retirement accounts.

Age

Education

Gender

Ethnicity

Household income

54% 49% 46% 51%

23% 33% 45% 31% 34% 35%

79%

21%

65%

35%

25%

45% 30%

51%

32% 17%

56% 44%

73%

27%

Male Female 18-34 35-54 55+

White Non-White Some college College graduate

or less or more

<$50K $50-$100K $100K+

n Investor Survey n U.S. Total

0 Comparing the demographics of Investor Survey

respondents to national estimates from the 2015 NFCS

State-by-State Survey, we see that investors differ

from the overall population in some important, but not

surprising, ways. Investors are slightly more likely to be

male, and considerably more likely to be older, white,

and college educated.
Investors in the United States 2016 4

Investing Behaviors

Individual stocks and mutual funds are the most commonly owned investments in non-retirement accounts. 

Nearly three-quarters of investors own individual stocks, and almost two-thirds own mutual funds. Only a 

small minority of investors own commodities or futures, or other investments such as REITs, options, private 

placements, or structured notes.

Value of non-retirement investments

About a third of respondents report having less than $50,000 

in non-retirement investments, another third report between 

$50,000 and $250,000, and slightly less than a third report 

having more than $250,000.

$50-$250K

33%

$250K+

28%

<$50

34% Don’t know/

No Answer

5%

74%

64%

43%

35%

33%

22%

15%

12%

Individual stocks

Mutual funds

Whole life insurance or similar 

investment products

Individual bonds

Annuities (fixed, indexed or variable)

Exchange-traded funds (ETFs)

Other investments such as REITs, options, 

private placements, or structured notes

Commodities or futures

Non-retirement investments
Investors in the United States 2016 5

Not surprisingly, investors with lower portfolio values tend to hold a less diverse mixture of investment 

vehicles than those with higher portfolio values. Additionally, it is notable that among those with portfolios 

of less than $50,000, individual stocks are by far the most common investment (71%), rather than mutual 

funds (46%) as might be expected. Mutual funds are as likely to be owned as individual stocks by those with 

portfolios of $50,000 or more.

Portfolio value

Non-retirement investments Total <$50K $50-$250K $250K+

Individual stocks 74% 71% 70% 83%

Mutual funds 64% 46% 68% 83%

Whole life insurance or similar investment products 43% 33% 50% 47%

Individual bonds 35% 25% 36% 48%

Annuities (fixed, indexed, or variable) 33% 18% 36% 47%

Exchange-traded funds (ETFs) 22% 15% 24% 30%

Other investments such as REITs, options, private 

placements, or structured notes 15% 9% 15% 22%

Commodities or futures 12% 9% 15% 15%

Fifty-three percent of respondents say that stocks or stock mutual funds make up more than half of their nonretirement portfolio.

How much of your non-retirement portfolio is invested in stocks or mutual funds that 

contain stocks? Total

More than half 53%

Less than half 33%

None 5%

Don’t know/No answer 10%

Trading frequency varies among investors. While 29% have not made a single transaction in the past year, 35% 

have made four or more transactions. 

In the past 12 months, how many times have you bought or sold investments in non-retirement accounts?

29% 30%

21% 14%

None 1 to 3 times 4 to 10 times 11 times or more
Investors in the United States 2016 6

Older investors (55 and up) are less likely than those 54 and under to have made four or more transactions in 

the past year. Not surprisingly, trading frequency increases with portfolio value.

Age Portfolio value

Total 18-34 35-54 55+ <$50K $50-$250K $250K+

Have made 4 or more 

transactions 35% 44% 41% 26% 25% 39% 46%

A third of investors report having accounts that permit purchasing on margin. Among these respondents, half 

have made securities purchases on margin. Ownership of margin accounts decreases with age. Investors with 

portfolios of more than $250,000 are more likely than those with under $50,000 to have a margin account. 

Age Portfolio value

Total 18-34 35-54 55+ <$50K $50-$250K $250K+

Have investment account 

that allows margin purchases 33% 54% 38% 20% 32% 34% 39%

More than a third of respondents (37%) say they have heard of investment crowdfunding (also known as 

equity crowdfunding or crowd investing). Younger investors are more likely than older investors to report 

awareness of investment crowdfunding. Awareness levels do not vary with portfolio value.

Age Portfolio value

Total 18-34 35-54 55+ <$50K $50-$250K $250K+

Have heard of investment 

crowdfunding 37% 58% 43% 22% 37% 38% 39%

Brokers/Advisors

Slightly more than half of respondents (56%) say they use a broker or professional advisor for at least some 

investment decisions, and 43% say they do not. 

Total

I let my broker or professional advisor make all my decisions for me 16%

I make some decisions on my own and some with the help of a broker or professional advisor 40%

I make all my investment decisions on my own without the help of a broker or professional advisor 43%

Investors ages 55 and up are more likely than those 54 and under to use a broker or advisor. Those with higher 

portfolio values are also more likely to use a professional advisor.5

Age Portfolio value

Total 18-34 35-54 55+ <$50K $50-$250K $250K+

Use broker or advisor 56% 45% 52% 63% 46% 55% 65%

5. The survey did not distinguish between brokers and advisors. For simplicity, the word “advisor” is used in this report to refer to both 

brokers and advisors.
Investors in the United States 2016 7

Among those who use a professional advisor, the most important reasons for doing so are to improve 

investment performance and to help avoid losses. Nearly two-thirds also feel it is important to learn about 

investment opportunities, and over half feel it is important to have access to investments they otherwise 

would not be able to have.

Phone or email communications with advisor in past 12 months

The vast majority (80%) of those who use an advisor have a 

specific person with whom they work. Seventy-three percent 

have communicated with their advisor via phone or email at 

least 2 to 3 times in the past year, and 80% have met in person 

with their advisor.

Over half (58%) of those who use an advisor say that professional designations or certifications are very 

important, but fewer than a quarter (23%) have checked with a regulator on the background of a financial 

professional. Those who feel professional designations are very important are more likely than those who 

feel they are less important to have checked on the background of a financial professional (28% vs. 17%, 

respectively, among those who use advisors).

More than half (56%) of those who use a professional advisor report having a clear understanding of how their 

advisor gets compensated (8 to 10 on a 10-point scale). Slightly fewer (47%) say they have asked their advisor 

how he or she gets compensated.

Reasons for using professional advisors

12% 13%

37%

21% 15%

None 1 2-3 4-6 7 or

 time times times more

 times

81%

78%

63%

53%

30%

To improve investment 

performance

To help avoid losses

To learn about investment 

opportunities

To have access to investments I 

couldn’t get on my own

To free up my time

% Very important
Investors in the United States 2016 8

Among respondents who use an advisor, fewer than half feel that various incentives and commission 

structures would affect the financial advice given to them. In contrast, among those who do not use advisors, 

majorities feel that these incentives would have a great affect on the advice given.

Sixteen percent of respondents say they have used an automated financial advisor that provides investment 

advice and makes trades for them. Usage of “robo-advisors” is higher among younger investors and those who 

do not otherwise work with a financial advisor.

Age Professional advisor

Total 18-34 35-54 55+ Use Do not use 

Have used an automated 

financial advisor 16% 38% 15% 4% 11% 23%

How much do you think each of the following would affect the advice that a financial advisor gives you?

43%

40%

34%

64%

62%

55%

His/her firm pays an incentive for selling 

certain investments

He/she receives compensation from third 

parties to sell their investment products

He/she receives a commission based on 

trading activity

n Use advisor n Do not use advisor

0 More than half (56%) of those who use a professional

advisor report having a clear understanding of how

their advisor gets compensated (8 to 10 on a 10-point

scale). Slightly fewer (47%) say they have asked their

advisor how he or she gets compensated.

0

% Affect a great deal
Investors in the United States 2016 9

Investment Fees

Seventy percent of respondents report that fees and pricing were important when opening their nonretirement investment accounts, and 62% say they have a clear understanding of the fees they pay for their 

investment accounts (8 to 10 on a 10-point scale).

The majority of investors (70%) feel that the fees they pay for their investment accounts are reasonable (5 to 7 

on a 7-point scale).

“The fees I pay for my non-retirement 

investment account(s) are reasonable”

How clear of an understanding do you have 

of the fees you pay for your non-retirement

investment account(s)?

How important to you were the fees and pricing 

structure when opening your non-retirement 

investment account(s)?

2%

Don’t know/

No answer

8-10 4-7

3%

Not important

(1-3)

25%

Neutral

70%

Important

2%

Don’t know/

No answer

8-10 4-7

5%

Not clear

(1-3)

31%

Neutral

62%

Clear

4%

Don’t know/

No answer

5-7

4

5%

Disagree

(1-3)

20%

Neutral

70%

Agree
Investors in the United States 2016 10

65%

28% 28%

23%

 3%

When asked what types of fees they pay for their investment accounts, a commission on trades was the most 

common answer. However, between 12% and 16% of investors did not know whether they paid specific types 

of fees on their account.

A majority of investors (74%) expect financial advisors to receive some form of compensation for selling bonds 

(commissions, markups, or some other compensation). Most respondents (65%) think that advisors charge 

commissions on bond transactions. Importantly, nearly one-quarter of respondents reported they do not know 

how investment professionals get compensated for fixed income transactions. Investors who own individual 

bonds are only somewhat more likely than those who do not to mention bond price markups (35% vs. 25%). 

Nearly all respondents (96%) say they at least skim their investment account statements, and just over half 

say they read the entire statement (52%). Investors with portfolios of over $250,000 are more likely to report 

reading the entire statement than those with smaller portfolios (63%, compared to 55% among investors with 

between $50,000 and $250,000, and 41% among those with less than $50,000 portfolios). 

Which of the following types of fees do you pay for your non-retirement investment accounts?

How can financial advisors get compensated when selling bonds to an investor?

n Yes n No n Don’t know

A commission on trades

A fixed monthly or annual fee

A percent of the total value of 

assets managed

48%

34%

33%

36%

53%

49%

15%

12%

16%

By charging a By marking up By some other They don’t get Don’t know

commission the price of means of compensated

the bond compensation for selling bonds

to investors

(select all that apply)
Investors in the United States 2016 11

Attitudes Toward Investing

The plurality of investors (39%) expect the average annual return of the S&P 500 to be between 5% and 9.9% 

over the next 10 years. Most investors (63%) expect their portfolio to do as well as the market as a whole. It is 

interesting to note that more investors think they will outperform the market (27%) than underperform (4%).

When asked what level of financial risk they are comfortable with, nearly half of investors (47%) describe 

themselves as willing to take average risks in exchange for average returns, less than a third (30%) say 

are willing to take above average risks, and 12% report being willing to take substantial risks in pursuit of 

substantial returns. 

Which of the following statements comes closest to describing the amount of 

financial risk that you are willing to take when you save or make investments? Total

Take substantial financial risks expecting to earn substantial returns 12%

Take above average financial risks expecting to earn above average returns 30%

Take average financial risks expecting to earn average returns 47%

Not willing to take any financial risks 10%

Investors with portfolios of less than $250,000 are more likely than those with higher portfolio values 

($250,000 or more) to say they are willing to take substantial risks. Respondents who expect their portfolio to 

outperform the market are also more likely to be willing to take substantial risks than those who expect their 

portfolio to do about the same as the market as a whole. 

Portfolio value Performance expectations

Total <$50K $50-$250K $250K+ Outperform 

market Same as market

Willing to take substantial 

financial risks expecting to 

earn substantial returns

12% 13% 15% 9% 19% 8%

What do you expect the approximate average 

annual return of the S&P 500 stock index to be over 

the next 10 years (without adjusting for inflation)?

Over the next 12 months, 

how well do you expect your portfolio

 of investments to perform?

Less than 5%

5% to 9.9%

10% or more

16%

 39%

 27%

Worse than the market 

as a whole

About the same as the rest 

of the market as a whole

Better than the market 

as a whole

4%

 63%

 27%
Investors in the United States 2016 12

Overall, investors appear to have mixed views of the U.S. securities market (as of summer 2015 when the 

survey was conducted). While 44% are confident that U.S. markets are a good long-term investment, 47% are 

neutral in their response. Less than a third (28%) of respondents report feeling confident that the U.S. financial 

markets are fair to all investors, and just over half (51%) give neutral responses.

Younger respondents are more likely than older respondents to feel confident in the fairness of the financial 

markets. Interestingly, there are no differences by portfolio value.

Age Portfolio value

Total 18-34 35-54 55+ <$50K $50-$250K $250K+

Confident that U.S. financial 

markets are fair to all investors 

(8 to 10 on 10-pt. scale)

28% 42% 31% 19% 27% 29% 31%

Respondents are also largely neutral in their opinions regarding the regulation of U.S. financial markets. Only 

27% are confident that regulators are able to keep up with new investment vehicles and technologies, and a 

quarter feel that the markets are effectively regulated to protect investors. Twenty-three percent are confident 

that regulators are looking out for ordinary investors, but just as many (25%) are not at all confident. 

How confident are you that U.S. financial markets 

offer good long-term opportunities for investors?

How confident are you that U.S. financial 

markets are fair to all investors?

2%

Don’t know/

No answer

8-10

4-7

6%

Not confident

47%

Neutral

44%

Confident 4%

Don’t know/

No answer

8-10

4-7

18%

Not confident

51%

Neutral

28%

Confident

1-3

How confident are you that...

27%

25%

23%

52%

54%

49%

17%

18%

25%

n Confident (8-10) n Neutral (4-7) n Not confident (1-3) n Don’t know/No answer

U.S. financial regulators are able to keep up 

with new market developments, investment 

vehicles and investment technologies

U.S. financial markets are effectively 

regulated to protect investors from fraud and 

abusive sales practices

The regulators of U.S. financial markets are 

looking out for ordinary investors

4%

4%

4%

1-3
Investors in the United States 2016 13

Investors who are willing to take above-average or higher risks are more likely than those willing to take 

average or lower risk to be worried about investment fraud (49% vs. 34%). Younger investors are more likely 

to be concerned about investment fraud than older investors. There are no differences by gender or portfolio 

value in concern about investment fraud.

Age

Total 18-34 35-54 55+

“I am worried about being victimized by 

investment fraud” (5 to 7 on 7-point scale) 40% 61% 43% 28%

Disclosures

More than half of respondents (59%) recall receiving disclosures regarding their investments, and just about 

half (51%) say they at least skim the disclosure.

Total

Recall receiving disclosures 59%

Read the entire disclosure 19%

Skim the disclosure 32%

Do not read the disclosure 8%

Do not recall receiving disclosures 27%

Don’t know/No answer 13%

Among those who recall receiving disclosures, almost three-quarters (74%) find them to be somewhat or very 

valuable.

I am worried about being victimized by investment fraud

When asked whether they are worried about investment 

fraud, no consensus emerges among investors. Two out of 

five respondents say they are worried about being victimized 

by investment fraud, and nearly the same percentage (37%) 

disagree.

5-7 4

1-3 1%

Don’t know/

No Answer

40%

Agree

22%

Neutral

37%

Disagree
Investors in the United States 2016 14

When asked how they would prefer to receive disclosures, paper documents in the mail was the most 

frequently chosen method (49%) among respondents surveyed. 

Preferred method for receiving disclosures Total

Paper documents physically mailed to you 49%

Documents delivered to you electronically by email 27%

In-person meetings with a broker or advisor 14%

Documents that you access on the Internet (not via email) 6%

Investors 35 and older are more likely than those 18-34 to prefer paper documents in the mail. Younger 

investors are more likely than older investors to prefer in-person meetings. There are no differences by age in 

preference for emailed disclosures.

What do you believe is the purpose of disclosures?

A majority of respondents (52%) believe that the purpose 

of disclosures is to protect both investors and institutions 

managing investments. 

Preferred method for receiving disclosures

Protecting investors

Protecting the institutions 

that manage investments

Both

Neither

 13%

 26%

 52%

2%

Paper documents physically Documents delivered to you In-person meetings with 

mailed to you electronically by email with a broker or adviser

37% 28% 27%

49%

28%

11%

54%

25%

10%

n 18-34 n 35-54 n 55+
Investors in the United States 2016 15

Information Sources

When making investment decisions, more than half of respondents say they use information from the 

company being invested in (68%), financial services companies (62%), and financial advisors other than 

stockbrokers (56%). Fewer than a quarter of respondents say they look to industry regulators, employers, or 

investment clubs for information.

Information sources for investment decisions Total

Information from the company you are investing in (e.g., annual reports, company websites) 68%

Information from brokerage firms, mutual fund companies, or other financial services 

companies (e.g., analyst reports, brochures, newsletters, seminars, websites) 62%

Financial advisors other than stockbrokers 56%

Friends, colleagues, or family members 47%

The media (i.e., TV, radio, newspapers, magazines, online news sources, and financial 

information websites) 44%

Stockbrokers 30%

Industry regulators (e.g., FINRA, SEC, state securities regulators) 23%

Your employer 18%

Investment clubs or investor membership organizations 17%

Respondents most often receive investment information through newspapers, magazines, or books (47%), 

and free online services (47%). Seminars (both free and paid) and paid online services are used much less 

frequently.

Channels for information about investing Total

Newspapers, magazines, or books 47%

Free online services 47%

Brochures or newsletters 39%

Television/radio programs 35%

Free seminars or group meetings 17%

Paid online services 14%

Paid seminars or group meetings 10%

0 Only a small percentage of respondents (7%) report

having ever used BrokerCheck®, a free tool from FINRA

that can help investors research the licensing and

professional backgrounds of brokers and brokerage

firms.
Investors in the United States 2016 16

Awareness of general consumer information tools is much higher than awareness of investor-oriented tools. 

For example, large majorities of respondents are aware of FreeCreditReport.com (82%) and CarFax (81%), but 

fewer than a quarter are aware of any of the investing-related tools tested (ranging from 24% for the SEC’s 

Investor.gov to 14% for IAPD, the SEC’s Investment Advisor Public Database).

Only a small percentage of respondents (7%) report having ever used BrokerCheck, a free tool from FINRA that 

can help investors research the licensing and professional backgrounds of brokers and brokerage firms. In 

contrast, 38% of respondents who have purchased a used car have used CarFax, and nearly seven out of ten 

have consulted online restaurant reviews such as Yelp or TripAdvisor. 

Awareness of consumer information tools

Usage of consumer information tools

82%

81%

62%

24%

21%

21%

16%

14%

FreeCreditReport.com

CarFax

AnnualCreditReport.com

Investor.gov

EDGAR database

SmartCheck

BrokerCheck

IAPD database

Read online restaurant Used CarFax Used BrokerCheck 

reviews [among used-car buyers]

69%

 38%

 7%
Investors in the United States 2016 17

Investor Literacy

To assess level of investment knowledge, respondents were presented with 10 multiple choice “quiz” 

questions covering various investment-related topics and concepts. Correct answers shown in bold text. 

In general, investments that are riskier tend

to provide higher returns over time than

investments with less risk.

True 76%

False 14%

Don't know 9%

If you buy a company’s stock...

You own a part of the company 73%

You have lent money to the company 14%

You are liable for the company's debts 1%

The company will return your original 

investment to you with interest 6%

Don't know 5%

If you buy a company’s bond...

You own a part of the company 10%

You have lent money to the company 65%

You are liable for the company's debts 4%

You can vote on shareholder resolutions 5%

Don't know 16%

Over the last 20 years in the U.S., the best average

returns have been generated by:

Stocks 55%

Bonds 8%

CDs 2%

Money market accounts 6%

Precious metals 8%

Don't know 19%

If a company files for bankruptcy, which of the

following securities is most at risk of becoming

virtually worthless?

The company's preferred stock 13%

The company's common stock 53%

The company's bonds 15%

Don't know 19%

Which of the following best explains why many

municipal bonds pay lower yields than other

government bonds?

Municipal bonds are lower risk 32%

There is a greater demand for municipal 

bonds 10%

Municipal bonds can be tax-free 34%

Don't know 23%

What has been the approximate average annual

return of the S&P 500 stock index over the past

20 years (not adjusted for inflation)?

-10% 0%

-5% 2%

5% 25%

10% 26%

15% 7%

20% 4%

Don't know 36%

You invest $500 to buy $1,000 worth of stock on

margin. The value of the stock drops by 50%. You

sell it. Approximately how much of your original

$500 investment are you left with in the end?

$500 21%

$250 35%

$0 23%

Don't know 20%

Which is the best definition of ‘selling short?’

Selling shares of a stock shortly after 

buying it 11%

Selling shares of a stock before it has 

reached its peak 20%

Selling shares of a stock at a loss 26%

Selling borrowed shares of a stock 21%

Don't know 22%

Which of the following best explains the

distinction between nominal returns and real

returns?

Nominal returns are pre-tax returns; 

real returns are after-tax returns 12%

Nominal returns are what an 

investment is expected to earn; real 

returns are what an investment 

actually earns

21%

Nominal returns are not adjusted for 

inflation; real returns are adjusted for 

inflation

12%

Nominal returns are not adjusted for 

fees and expenses; real returns are 

adjusted for fees and expenses

9%

Don't know 44%
Investors in the United States 2016 18

Correct answers to individual quiz questions range from 76% for the risk and return question to 12% for the 

question on nominal vs. real returns. More than half of respondents give incorrect answers to the questions 

about buying on margin (56% incorrect) and selling short (56% incorrect).

The majority of respondents (56%) are able to answer fewer than half of the questions correctly. Only 10% are 

able to answer 8 or more questions correctly.6

Not surprisingly, performance on the quiz questions is correlated with a number of demographic 

characteristics. Men, older respondents, and those with higher portfolio values tend to do better on the quiz 

questions.

6. Percentages in the chart do not appear to add up to figures cited in the text due to rounding.

Number of correct quiz questions

Performance on investor literacy quiz questions

1% 3%

11% 16% 18% 18%

11% 6% 2%

5%

8%

17%

29%

44%

63%

81%

1% 4%

10%

92%

98% 100%

10 9 8 7 6 5 4 3 2 1 0

Percent

Cumulative

4.4 4.9 3.8 3.8 4.4 4.7 3.9 4.4 5.1

3.4 3.4

3.4 4.6 3.6 2.7 3.8 3.5 3.0

2.2 1.7 2.7 1.6 2.0 2.6 2.3 2.0 1.8

Total Male Female 18-34 35-54 55+ <$50K $50- $250K+

 $250K

Total Gender Age Portfolio value

n Correct n Incorrect n Don’t know

# out of ten questions

Note: Values may not sum to 10 due to rounding
Investors in the United States 2016 19

Forty-six percent of respondents indicate they are comfortable making investment decisions (8 to 10 on a 

10-point scale), but slightly more (48%) give themselves neutral ratings. Almost two-thirds of respondents 

(65%) rate their own investment knowledge highly (5 to 7 on a 7-point scale).

Respondents’ self-assessments of their comfort with and knowledge of investing are correlated with their 

performance on the quiz questions. Those who are comfortable making investment decisions are able to 

answer 4.8 of the 10 questions correctly, compared to 4.2 among those who are neutral, and 3.1 among those 

who are not comfortable. Similarly, respondents who rate themselves highly on investment knowledge are 

able to answer 4.8 questions correctly, compared to 4.0 for those who give themselves neutral ratings, and 3.4 

among those who feel they have low knowledge. 

How comfortable are you when it comes 

to making investment decisions?

How would you assess your overall 

knowledge about investing?

Quiz performance by comfort with 

investment decisions

Quiz performance by self-assessed 

investment knowledge

Interestingly, respondents who report high comfort and knowledge levels are also more likely to answer the 

quiz questions incorrectly than those with less positive self-perceptions, as the charts above show. It appears 

as if these respondents are more likely to guess (and sometimes guess incorrectly) than to admit they do not 

know.

1%

Don’t know/

No answer

8-10

4-7

6%

Not 

comfortable

48%

Neutral

1%

Don’t know/

No answer

5-7

4

 15%

Low

19%

Neutral

 65%

High

1-3

1-3

46%

Comfortable

Comfortable

(8-10)

Neutral

(4-7)

Not comfortable

(1)

High

(5-7)

Neutral

(4)

Low

(1-3) 3.1

4.2

4.8

2.3

3.1

3.9

4.6

2.6

1.3

3.4

4.0

4.8

2.5

2.9

3.8

4.1

3.0

1.4

n Correct n Incorrect n Don’t know

# out of ten questions

n Correct n Incorrect n Don’t know

# out of ten questions

Note: Values may not sum to 10 due to rounding Note: Values may not sum to 10 due to rounding
Investors in the United States 2016 20

Conclusion

The 2015 Investor Survey—a component of the FINRA Foundation’s 2015 National Financial Capability 

Study—provides a wealth of additional information on investing-related topics of interest to researchers, 

educators, policy makers, and financial industry stakeholders. Findings show that stocks and mutual funds are 

the most commonly held types of investments, with other types of investments such as ETFs, REITs, options, 

commodities, and futures still relatively exotic. More than half of investors use a broker or professional 

advisor, and among those that do, fewer than half are worried that various incentives and commission 

structures would present a conflict of interest.

Investors appear to be fairly optimistic about the performance of the market as a whole, and even more 

optimistic about the performance of their own portfolio. However, they are relatively less confident in the 

ability of regulators to ensure fairness in the market. Awareness of investor-oriented information tools (e.g., 

Investor.gov, BrokerCheck), is low, and use of these information tools is even lower. 

Investor literacy, as measured by a 10-item quiz, shows room for improvement. While majorities understand 

the relationship between risk and return, and are able to correctly define stocks and bonds, very few 

understand concepts such as buying on margin, selling short, and the difference between nominal and real 

returns. 

Finally, the survey reveals some interesting generational differences among investors. Younger investors 

are less likely to use professional advisors, more likely to use “robo-advisors,” and more likely to be familiar 

with the concept of crowdfunding than older investors. Younger investors also express more concern about 

investment fraud than older investors do. Future tracking research can help determine which of these become 

lasting trends among investors and which are just temporary fads. 

0 Investors appear to be fairly optimistic about the

performance of the market as a whole, and even

more optimistic about the performance of their own

portfolio. However, they are relatively less confident

in the ability of regulators to ensure fairness in the

market. Awareness of investor-oriented information

tools (e.g., Investor.gov, BrokerCheck), is low, and use of

these information tools is even lower.
Investors in the United States 2016 21

Background and Methodology

In consultation with the U.S. Department of the Treasury and the President’s Advisory Council on Financial 

Literacy, the FINRA Investor Education Foundation commissioned the first national study of the financial 

capability of American adults in 2009. The overarching research objectives of the National Financial Capability 

Study were to benchmark key indicators of financial capability and evaluate how these indicators vary with 

underlying demographic, behavioral, attitudinal, and financial literacy characteristics.

The 2009 NFCS consisted of three linked surveys:

0 National Survey: A nationally projectable telephone survey of 1,488 American adults

0 State-by-State Survey: A state-by-state online survey of 28,146 American adults 

(roughly 500 per state, plus the District of Columbia)

0 Military Survey: An online survey of 800 military service members and spouses

In 2012, a second wave of the NFCS was conducted in order to assess changes in key measures from the 2009 

Study. The 2012 NFCS replicated two of the three components of the original baseline study:

0 State-by-State Survey: A state-by-state online survey of 25,509 American adults 

(roughly 500 per state, plus the District of Columbia)

0 Military Survey: An online survey of 1,000 military service members

In 2015, a third wave of the NFCS was conducted to continue tracking key measures from the 2009 and 2012 

Studies, and to incorporate additional topics that are highly relevant today. The 2015 NFCS replicates the two 

components of the 2012 study, and adds a supplemental survey of investors:

0 State-by-State Survey: A state-by-state online survey of 27,564 American adults 

(roughly 500 per state, plus the District of Columbia)7

0 Military Survey: An online survey of 1,500 military service members

0 Investor Survey: An online survey of 2,000 Americans who have investments outside of 

retirement accounts

The survey instruments were designed by a multi-disciplinary team of researchers, policy makers, and 

practitioners in the financial capability field. The Studies were funded by the FINRA Investor Education 

Foundation and conducted by Applied Research & Consulting.

This report outlines the findings of the 2015 Investor Survey administered to respondents in July 2015. Data 

from the survey are weighted to be representative of investors with non-retirement investments in terms of 

age and education, based on the 2015 NFCS State-by-State Survey. However, breakdowns of sub-populations 

may not necessarily be representative. 

More information about the National Financial Capability Study, including survey instruments and detailed 

methodological information, can be found at www.USFinancialCapability.org.

7. The 2015 State-by-State Survey includes oversamples for four large states (CA, IL, NY, and TX).
Investors in the United States 2016 22

Authors:

Judy T. Lin, Christopher Bumcrot, Tippy Ulicny

Applied Research & Consulting LLC

Gary Mottola, Christine Kieffer, Gerri Walsh

FINRA Investor Education Foundation

Acknowledgments:

The FINRA Foundation thanks the following people for their valuable help and insightful comments.

Brian Mulford, Lori Schock

U.S. Securities and Exchange Commission

Shari Crawford, Sara Grohl, Mimi Masse, Jonathan Sokobin, Richard Vagnoni,

Michelle Volpe-Kohler, Angelita Williams

FINRA
www.finrafoundation.org

© 2016. FINRA Investor Education Foundation. 

All rights reserved. 

16_0388.1 — 12/16

A copy of this report can be found on

www.USFinancialCapability.org 

or by calling (202) 728-6964.