TD Ameritrade Survey reveals investors uncertain about the benefits and risks of options

Jan. 28, 2011 - PRLog -- MILWAUKEE, WIS. – In an effort to find out what US investors knew about ‘options,’ an under-utilized investment tool practiced by only a small percentage of US Consumer investors, TD Ameritrade, America’s #1 online broker, recently worked with Market Probe of Milwaukee to conduct a pivotal research study.  

“Market Probe's Financial Services Practice has been conducting surveys for TD Ameritrade since 2005”, said Dr. Tom Fusso, Market Probe’s Senior Vice President. “This survey, which was conducted to assess investors’ knowledge of, attitudes toward, and actual trading behavior related to options, was particularly revealing.”

The Market Probe Survey determined that many investors view options as intimidating for three primary reasons. The investor thinks options are too risky, are only for active or sophisticated buyers, and are too complex for the average investor to understand.

In making these findings, Market Probe provided actionable marketing insight to the world-class financial services firm that had commissioned it. In order to capitalize upon this unique investment instrument, TD Ameritrade will need to make options a readily understood and more appreciated, well:  option.

“Despite an increase in the tools, educational offerings and research available to help individual investors of all experience levels better understand the risks and benefits of trading options, many still view them as too complex and risky,” said Joe Kinahan, chief derivatives strategist for TD Ameritrade.

“This survey tells us that while the tools are available, more education is necessary to help dispel some of the ‘myths’ that continue to exist with respect to options.”

Market Probe helped to uncover the major impediments to keen investor participation in options. The results of the survey will allow TD Ameritrade to fine-tune their options-trading services and determine how best to communicate those services to the market.

Survey Methodology
The results were based on a telephone survey conducted for TD Ameritrade Holding Corporation by Market Probe in 2010. 650 respondents participated in this survey. Respondents were polled from a random sample of affluent US households. To be eligible for this survey, respondents had to have an account at a brokerage or mutual fund company, at least $5,000 in marketable securities or cash and have bought or sold securities at least once in the past 12 months.
The margin of error in the survey was ±3.8%. This means that in 19 cases out of 20, survey results based on 650 respondents will differ by no more than 3.8 percentage points in either direction from what would have been obtained by seeking the opinions of all eligible investors.


More on Market Probe
Market Probe is a full-service global research firm has offices in Milwaukee, New York, St. Louis and Portland in addition to 10 countries around the world. It was founded in 1976 and specializes in stakeholder measurement programs focusing on customers, employees and brands. Market Probe’s experienced researchers have pioneered new applications of quantitative research methods and statistical models as well as customized software for reporting results. With offices in the United States and in Canada, Belgium, France, the United Kingdom, the United Arab Emirates, Bahrain, India, Singapore, Hong Kong and China, Market Probe is well positioned to meet the domestic and global research needs of companies throughout the world. For more information visit www.marketprobe.com.

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