Over the past year, two fifths of advisers surveyed by Heartwood abandoned traditional sources of income like property and fixed income for multi-asset products, in an attempt to achieve “more reliable long-term income” for their clients.
Of the traditional income strategies, high-yield bonds were rejected the most frequently for multi-asset funds in 2016 by 65% of advisers.
Just over half (51%) of advisers said they would transfer their clients’ investments from property into multi-asset funds for greater income opportunities, followed by emerging market debt (43%).
And Heartwood’s survey indicated that a greater number of advisers had eschewed the UK equity income products, with one in four (38%) leaving the sector.
The feedback also highlighted changes in advisers’ objectives, with 59% responding that a ‘stable monthly income’ was a ‘must have’ quality in an income-generating investment, versus just 55% in 2015.
Only slightly more than a quarter (28%) viewed ‘total return’ potential as their most important criterion in the selection process, down 7% from the previous year.
