Magazine article American Banker

A Look at Who Owns Fund Shares

Magazine article American Banker

A Look at Who Owns Fund Shares

Article excerpt

A study by the Investment Company Institute paints a demographic portrait of mutual fund shareholders.

The first study of its kind, according to the mutual-fund trade group, it is based on a telephone poll of nearly 800 fund shareholders. The survey was completed in July, and the results were released late last month.

Sandra West, director of marketing research at the Washington-based institute, said the study provides clues about future demand for financial services.

"We know from prior research that 27% of all U.S. households own at least one mutual fund," Ms. West said. "Clearly, mutual funds have become an important choice for many investors."

Some bankers are taking note of demographic trends in an effort to capture more business as customers graduate from deposits into more sophisticated investments.

"We are trying to target the first wave of baby boomers," said Thomas Luing, vice president of Norwest Investment Services, Minneapolis, a unit of Norwest Corp. "I'm seeing a shift in our customers, but our average customer is still around 60 and wealthy."

New Investors and Old

One-tenth of the people who owned mutual fund shares when surveyed had owned none two years ago, the researchers found.

Not surprisingly, the new mutual fund investors were younger, less affluent, and have fewer dollars in the bank than veteran shareholders. But there was some evidence that the consumption-crazy baby boom generation is coming into financial maturity. …

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