Survey Reveals Investment Knowledge Gaps Among Experienced Investors in Japan

Overview of the Survey

Bayview Asset Management, based in Chiyoda, Tokyo, conducted a recent survey titled 'Market Awareness Survey on Investment Management' from February 24 to February 26, 2025. The survey targeted 1,000 individuals aged between 20 to 60 who have experience with investment trusts (funds). The findings reveal that nearly half of the respondents have over ten years of investment experience, yet more than 70% feel insecure about their investment knowledge.

Key Findings

1. Investment Experience: Among the respondents, 29.5% have over 20 years of investment experience, and 18.8% have been investing for between 10 and 20 years. This indicates that approximately half (48.3%) of the participants have more than a decade of experience.

2. Knowledge Gaps: Surprisingly, 73.4% of the respondents admitted they do not feel knowledgeable about investments. This suggests a significant gap between experience and actual understanding of investment concepts.

3. Understanding of Investment Trusts: While 72.5% of participants knew that there are 'sales companies' and 'management companies' in mutual funds, only about half could distinguish between them or knew that they could purchase investment trusts directly from management companies.

4. Investment Criteria: When choosing an investment trust, the most crucial factor for 38.3% of respondents was historical performance, with over 62.7% tracking their investment performance post-purchase. However, about 37.3% reported not fully understanding the performance of their current investments.

5. Cost Understanding: Although over 80.5% of the respondents recognize the existence of sales fees and trust fees, only about 31.7% truly understand the cost structure related to trust fees.

6. Investor Concerns: The survey unveiled that 71.1% of respondents worry about the risk of losing their principal investment, highlighting a prevalent fear when delving into trust funds. Others expressed concerns about their lack of investment knowledge (45.2%).

Implications of the Findings

The results underscore a stark contrast in Japan's investment landscape, where a significant portion of the population, despite possessing investment experience, remains uncertain about their knowledge and understanding of investment structures. Factors such as a high ratio of cash and deposits compared to investments reflect a cultural inclination towards safety and risk aversion, further complicating the situation.

In response to this landscape, Bayview Asset Management has announced plans to launch an online direct sales service for their mutual funds, starting with a product called 'Wise Design', which is expected to provide stable returns while minimizing risk. This service aims to cater to individuals who are hesitant due to their limited knowledge about investing.

About Bayview Asset Management

Founded in 1998, Bayview Asset Management has evolved into one of Japan's largest independent asset management firms, managing over 1 trillion yen in assets. The company prides itself on its independence from external shareholders, allowing it to focus solely on investor interests. Bayview embraces a multi-boutique model, providing specialized high-quality investment services, setting itself apart from traditional department-store-like asset handling firms. The firm's commitment to transparency and rigorous security measures further enhances its reliability.

The ongoing challenges of educating investors about the intricacies of their investments remain, yet Bayview aims to tackle these issues head-on by offering tailored products and services to enhance individual investors' confidence and success in navigating the investment realm.