Who trusts the financial system? According to a new poll, fewer than one in four Americans.
The quarterly Chicago Booth/Kellogg School Financial Trust Index measures trust in the areas of banks, the stock market, mutual funds, and large corporations.
The survey showed that only 23% of those polled trust the country's financial systems, down from an equally dismal 25% in June.
Specifically, trust in banks has dropped from 39% in June to 33% in October. "Notably, people were much more inclined to trust local banks and credit unions: More than half of those surveyed said they still had faith in those institutions."
Distrust in the stock market (16%) and large corporations (16%) remained stable from June to September. However, when asked about the likelihood of the stock market dropping 30% in the next 12 months, 55% of respondents said it was likely, compared to 50% in June.
More findings: 60% of respondents were angry about the current financial system and economic climate. This is the highest level of anger measured since the earliest months of the financial crisis.
The findings reflect the sentiment reported in the news and "demonstrate the fragility of trust many Americans still have in the institutions where they invest their money," says Luigi Zingales, co-author of the Financial Trust Index.
The rising trend of mistrust might mean hits for online brokerage firms who largely rely on trading fees for profit. If distrust in the market is rising, it follows that trading activity will decline.
To track that idea we list below some of the firms with exposure to this trend. Do you think these names will feel the effects of national distrust? (Click here to access free, interactive tools to analyze these ideas)
1. TD AMERITRADE
2. E*TRADE Financial
3. Interactive Brokers Group
4. Piper Jaffray
5. Charles Schwab
Interactive chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Rebecca Lipman does not own any of the shares mentioned above. Data from Finviz.
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