Slowly but surely, investors are starting to show a little more confidence in investing in U.S. capital markets, and in auditors and audit committees to watch out for their interests.
The annual “Main Street Investor Survey” says 80 percent of retail investors expressed confidence in U.S. public companies this year, only a slight increase from the 79 percent last year but the highest level ever recorded since the Center for Audit Quality began conducting the survey in 2007. As for confidence in capital markets in general, 73 percent of investors said they have at least some confidence, up from 69 percent in 2013.
The survey asked investors which players in the capital markets are most effective in looking out for investor interests, and independent auditors won the most praise with 75 percent of investors naming auditors as their advocates. That’s also rising, from 72 percent in 2013, 70 percent in 2012, and 67 percent in 2011. Close behind auditors in the latest survey, 71 percent of investors also named the independent audit committees of public companies, followed by 70 percent each naming brokers and exchanges; 68 percent credited financial analysts, and 64 percent named credit rating agencies.
U.S. investors are a little more wary of investing overseas, with only 43 percent of investors showing confidence in capital markets outside the United States. That figure hit an all-time low in 2012 at 35 percent, then recovered in 2012 to 42 percent.
Cindy Fornelli, executive director of the CAQ, said in a statement that the annual survey with now nearly a decade of data can be useful to policymakers and others. The survey “provides a unique perspective on the views of retail investors as they’ve navigated through one of the most turbulent financial periods in U.S. history,” she said. "These findings should encourage anyone with an interest in the health of our capital markets. They bode well not just for investors, but for the entire U.S. economy, which relies on vibrant financial markets as an engine of capital formation and economic growth."