ima stalwart investors believe in equities

Investor belief in an equity recovery is holding strong, despite a drop in overall confidence levels over the past six months, according to statistics from the IMA.

ima stalwart investors believe in equities


Individuals’ appetite for investing has also been maintained, with 35% of UK investors intending to put money into a new investment product within the next 12 months, while 46% plan to add to existing investments.

This is in the face of lower confidence levels regarding the outlook for the next 12 months when compared to six months ago: The IMA’s Confidence Index for September registered 85 out of a possible 200, compared with 104 six months earlier.

But despite these headwinds 49% of those looking to take out a new product in the next year plan to invest in equities.

In comparison, just over a quarter are looking to invest in fixed income products while 17% plan to invest in commodities.

This is at odds with the asset class investors believe will post the best returns, as only 21% of those planning to invest in new products think equities will come out tops, while 31% think commodities are likely to.

Richard Saunders, chief executive of the IMA, said this showed a maturity of decision making among retail investors that they are not always credited with.

"Often we hear about retail investors pursuing a herd mentality, buying at the top of the market and selling at the bottom. But our findings suggest a stalwart investor committed to saving for the long term despite market volatility. Almost half intend to invest in the stock market in the coming months," he said.

Risk aversion is still playing on investors’ minds, however, with 27% of those looking to invest in the next 12 months intending to invest in fixed income, the asset class 23% believe to be the least risky.