Advisors Are Growing as Pessimistic as Their Clients: MFS Investment Survey

Financial advisors have grown “decidedly more pessimistic” about the U.S. economy in 2011, closing the gap that existed earlier in the year between advisors and their clients, according to a new survey released Wednesday by MFS Investment Management.

Boston-based MFS held the survey in October and September, asking both advisors and investors how they felt about the economy, and 27% of advisors said they were pessimistic about the U.S. economy over the next five years. That compares to only 7% in February.

As for investors, 53% are pessimistic about the U.S. economy, up from 37% in February, according to the online survey of 929 individual investors with more than $100,000 in investable household assets and 644 licensed advisors with at least $500,000 or more in annual mutual fund sales. MFS sponsored the survey, conducted by independent research firm Research Collaborative.

“The wall of worry was there in February, but this fall it came into full focus for advisors just how big that wall was,” said William Finnegan, senior managing director and head of U.S. marketing for MFS, in an interview with AdvisorOne in New York. “The investor and the advisor are now much more closely aligned in their opinions.”

The willingness to take on risk, both in domestic and international investments, has declined since February, said Finnegan. In particular, he noted a surprising barbell of shared pessimistic conservatism between Generation Y investors under the age of 31 and baby boomer investors between the ages of 46 to 64.