Investor satisfaction with the overall full-service investments industry has risen for the third consecutive year, according to the J.D. Power 2014 U.S. Full Service Investor Satisfaction Study released today.
On a 1,000-point scale, investor satisfaction for 2014 was 807, up from 789 in 2013, 775 in 2012 and 772 the prior year.
The 12th annual version of the study conducted by the Westlake Village, Calif.-based marketing information services company measures overall investor satisfaction in seven areas (listed in order of importance): investment advisor; investment performance; account information; account offerings; commissions and fees; Web site; and problem resolution.
Fidelity Investments ranked highest in overall satisfaction with a score of 842. The firm improved by 32 points from its second place ranking the prior year.
Edward Jones ranked second with a score of 835 and Charles Schwab & Co. Inc. ranked third with a score of 825.
However, the survey didn't paint a completely rosy picture for the brokers. Younger investors under 35 years old, it turns out, are less satisfied with their full-service investment firm than their older investor counterparts, averaging 791 compared with 806 for investors nearing retirement and 827 for retired investors.
Among young investors, 44 percent indicate they “strongly agree” that their advisor has a good understanding of their investment goals. In contrast, 71 percent of retired investors say the same.
Additionally, only 39 percent of young investors “strongly agree” that their advisor makes efforts to ensure they understand where their investments are made and why, compared with 66 percent of retired investors.
“Advisors tend to focus their attention on older, more affluent investors with whom they have more experience,” said Craig Martin, director of investment services at J.D. Power. “They are comfortable with this group and their preferences, but when they interact with younger investors they have challenges connecting. They often try to use the same approach that has been successful with their older clients, but it often misses the mark.”