A lack of confidence in financial institutions has pushed clients towards direct investments, according to a new report by industry market researcher, Investment Trends.
New data is consistent with Investment Trends’ research showing trading shares online rose by 50,000 over the last year to a new high of 650,000 in May 2010.
Senior analyst with Investment Trends, Pawel Rokicki, said life is challenging for fund managers at the moment, but rising interest in direct investments “clearly benefits providers of online share trading.”
“During [the global financial crisis], [investors] realised that money they spent on active management is not necessarily bringing them value; increased share trading is a result of that,” he said.
In July 2009, more than half of surveyed participants hinted they no longer trust fund managers and would invest directly in future.
Rokicki said unreleased figures from this year’s ‘Investor sentiment and communications’ report revealed there is a lack of trust in fund managers.
“Financial planners intend to put more of clients’ funds into direct equities, so this trend was consistent in the advice and direct channel,” Rokicki added.
