80% of households do not invest in the stock market

People are put off stock market investments through lack of knowledge or fear of falls in investment markets, with the majority preferring bank or building society savings or property investments, according to a survey by Riley, the individually insured investment from Royal London.

The research, conducted by YouGov on behalf of Riley, asked over 2,000 households a range of questions about their finances. When asked where they saved most of their money, 61% stated bank or building society accounts while 7% said it was in property. In contrast only 3% put most of their money in the stock market, while just 20% said they had any investment at all in stocks and shares. Even when asked what they would do with a £100,000 windfall, only 4% would invest it in the stock market, while 39% would invest in property and 36% would put it in the bank.

Roger Edwards, Head of Marketing Development, commented: "Recent stock market volatility, coupled with longer memories of the crash 20 years ago, have put people off investing in the stock market, yet research shows that medium to longer term investments in stocks and shares offers most potential for capital growth. IFAs have an extremely important role to play in encouraging people to invest for the longer-term in stocks and shares. And a product such as Riley, which allows access to potential stock market gains with flexible protection against possible falls, gives investors a useful alternative to holding money in deposit accounts.”

Riley offers investors the opportunity for stock market gains with a flexible level of protection. The chosen protected amount is insured by putting part of the original investment into a fund which holds protection contracts provided by a leading investment bank. The remainder of the investment goes into a choice of two funds: the FTSE 350 Tracker Fund, managed by RLAM (Royal London Asset Management), or the FTSE 350 Managed Fund, managed by Andy Simpson at Schroders.