Retail and institutional investors are exhibiting behavior that is at odds with their investment goals, according to a new study by State Street's Center for Applied Research.

"The Influential Investor: How Investor Behavior is Redefining Performance" was based on 12 months of research and input from more than 3,300 investment management industry participants. The research highlighted that most retail investors believe preparing for retirement requires aggressive investing, yet 31 percent of their assets are in cash. Institutional investors love alternative investments but admit that they don't have a deep understanding of these assets.

"While investors have never been as aware of their micro and macro environments, they are exhibiting behaviors that are divorced from their stated investment objectives," said Kelly McKenna, global head of the State Street Center for Applied Research.

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