Wealth managers, private banks and family offices are becoming increasingly concerned over the investment outlook for UK and European equities, according to the ‘Practical Intelligence Barometer’, a market research study conducted by Fundamentals, a specialist financial services marketing consultancy, and Broadgate Mainland, a leading PR agency in the sector.
The 20 professional investors who took part in extensive interviews for the qualitative research report expressed concerns about Europe’s investment potential due to the high levels of consumer and national debt. The UK in particular is cited as an anxiety for investors and their focus is turning away from the Eurozone in favour of Asia and in some cases, the United States which they believe is better placed to take advantage of the recovery than the UK. Absolute return funds, gold and US equities were the investment categories in favour.
Findings from the ‘Practical Intelligence Barometer’ also reveal that professional investors are looking for easy to understand, transparent products for their clients as a consequence of the recent financial markets upheaval. This has had a knock on effect on the numbers of advisers recommending UCITS III funds to clients; advisers were found to be very receptive to the regulated, liquid and transparent nature of these funds.
Chris Ambler, director at Fundamentals, says: “The Practical Intelligence Barometer has thrown up some interesting insights into the mindset of the professionals who are advising HNW clients. Negative news stories and results from UK companies are unsurprisingly prompting investors to look elsewhere. It has become commonplace to hear of investors seeking opportunities in the BRIC countries, but they are now looking at an ever wider range of opportunities.”
Mark Knight, a director at Broadgate Mainland, says: “A prevalent theme from our interviews illustrates the need for simplicity and strong communications from product providers on the funds side. An investment house that chooses to ignore investors demands for concise communications may find themselves losing business, it should be a case of ignore this at your peril.”
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