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New Study Reveals American Investing Habits and Attitudes; Findings Indicate Threat of War Will Not Affect Investing Behavior.

Business Editors

BELLEVUE, Wash.--(BUSINESS WIRE)--Dec. 5, 2002

ShareBuilder Securities Corporation, the nation's fastest growing online brokerage(1), today released the results of a joint study with Harris Interactive revealing Americans' attitudes toward investing and the economy.

Key findings of the November ShareBuilder Report include current investor opinions regarding market recovery, retirement issues and corporate responsibility.

Despite growing political unrest and continuing economic challenges, two-thirds of Americans who own a brokerage account said they would not change their investing behavior if the country goes to war. Specifically, 69 percent of those polled said they would neither increase nor decrease the amount they invest. Just 8 percent of these investors said they would reduce the amount they invest in the event of war.

"ShareBuilders' customer base comprises over a half million small, individual investors, giving us access to specific information about the mindset of this very important investor group. The ShareBuilder Report is a tool we use to understand our own customers, as well as providing something of an barometer for overall investor sentiment," said Jeff Seely, CEO, ShareBuilder Securities Corporation. "It's no secret that skepticism about Wall Street and corporate integrity is high right now, but our research indicates that most people believe in the long-term viability of the public markets."

Industry Preferences

The November ShareBuilder Report also revealed statistics on Americans' feelings toward investing in a particular industry. American investors were asked the hypothetical question -- "if presented with $1,000 to invest with the condition that all the money had to be invested in one industry, which industry would you select?" The greatest proportion, 27 percent of U.S. households, would invest in pharmaceuticals, while 20 percent of U.S. households would select technology. Eighteen percent of Americans would invest in healthcare.

Gauging Recovery

And for many Americans, the stock market recovery may be far off. The November ShareBuilder Report exposes Americans' feelings toward stock market recovery. Americans were asked at what level would the Dow Industrial Average need to climb to before they would consider the stock market to have made a full recovery. The majority of respondents (48 percent) believe that the 10,000 point threshold is the true mark of recovery, while more than a quarter (31 percent) feel that recovery falls below 9,500.

Retirement Needs

Americans were also questioned about maintaining their lifestyle in retirement. Nearly half of Americans (49 percent) believe they would need $300,000 or more in savings in order to retire and maintain their lifestyle. Comparatively, less than a quarter (20 percent) say that they would need $1 million or more in savings. Surprisingly, 18 percent of Americans said they would require less than $100,000.

Corporate Trust

Corporate trust and the accuracy of financial statements also has had a profound effect on investors' decisions of whether or not to invest in the stock market. According to the survey, 62 percent of all investors and those likely to invest believe it is very important that they trust the accuracy of financial statements prepared and reported by U.S. corporations.

Portfolio Confidence

Finally, The ShareBuilder Report asked Americans about their confidence in their investment portfolios. Nearly half of Americans (47 percent), who have a brokerage account or are likely to open one, are very or somewhat confident that their investment portfolio will out-perform the overall market in the next year. More than a quarter (28 percent) are neutral on the subject, while exactly one-quarter of Americans are not confident about their ability to outperform the market.

About The ShareBuilder Report

The ShareBuilder Report is a national survey on the attitudes and behaviors of investors conducted semi-annually by Harris Interactive for ShareBuilder. According to Salomon Smith Barney and JP Morgan quarterly industry reports, ShareBuilder is the fastest growing and 8th largest online brokerage in the United States, providing long-term investment solutions for mainstream investors. ShareBuilder commissioned Harris Interactive, a leading marketing research and polling firm, to survey 1,014 adults during the period of Oct. 10-13, 2002. For a sample size of 1,014 people, there is an average sampling accuracy of +/- 3.1 percent at the 95 percent confidence level.

About ShareBuilder

ShareBuilder (www.sharebuilder.com) is an online brokerage service designed to make investing in the stock market simple, automatic and affordable. With no account or investment minimums and no annual fees, customers can begin a program of regular and automatic investing for just $4 per transaction -- or customers can build their portfolios with unlimited stock purchases for only $12 a month. "ShareBuilders" typically invest the same dollar amount each month in a selection of securities, regardless of the share price of the stock. They choose from over 4,000 stocks, index funds and closed-end bond funds, selecting the dollar amount they wish to invest and the frequency (one-time, weekly or monthly). Recurring investments can be funded automatically by payroll deduction or direct debit from checking or savings accounts, or separately by check or wire transfer. Real-Time buy and sell trades are also available for just $15.95 and $19.95 through market and limit orders respectively. ShareBuilder Securities Corporation is a registered broker-dealer and member NASD/SIPC.

(1) Salomon Smith Barney, The Online Brokerage Rankings, November 2002
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Publication:Business Wire
Geographic Code:1USA
Date:Dec 5, 2002
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