The Schroders Global Investment Trends Report revealed that 41% of investors are feeling more positive about the investment environment now than they did last year, while over half (56%) stated they believe equities offer the best growth potential.
While more than half of investors are looking to achieve long-term capital growth and income generation, however, just 12% are allocating capital to higher-risk higher return investments.
Foreign market fear
The survey results provided further evidence that UK investors remain reluctant to invest in opportunities beyond the domestic market. Although more than half, 57%, believe Asia Pacific offers attractive growth opportunities just 15% are planning to commit their own capital to the region.
A Legg Mason survey conducted earlier in the year revealed that of all so-called global investors in the UK, just 21% have actually invested outside of the domestic market. A Franklin Templeton study, meanwhile, showed that a significant proportion of investors were hesitant to invest outside the UK due to currency issues and lack of local market knowledge.
Anxiety remains
The eurozone debt crisis is the greatest investment concern for UK investors and 67% state that this is impacting their investment decisions, while weak economic recovery and low interest rates were deemed problematic by 51% and 47% of UK respondents respectively.
Robin Stoakley, head of UK intermediary at Schroders, said: ““UK investors recognise investment opportunities are good – stock markets globally are showing strong growth and the FTSE has recovered the losses it suffered in 2008, growing 11% already this year.
“Equally while investors understand they need to gain exposure to global, particularly emerging markets assets if they are to maximise growth potential, many remain cautious when it comes to committing their own money to these assets. This paints a mixed picture for UK investors. On the one hand they are seeing growth opportunities in UK, emerging markets and Asia but on the other they remain over-weight in cash and are potentially failing to capitalise on improving economic conditions.”
