Global market turmoil leaves Aussie investors unshaken
Less than 18 per cent ofNorwich Union Navigatorinvestors have made major changes to their investment portfolios over the past 12 months despite turmoil on global markets.
Navigator documented 3100 client switches between funds in July of this year, an increase of only 500 on the figure reported over the same month last year.
The figure suggest Australian investors are not making hasty decisions based on current volatility in global markets and that clients are becoming more educated about the benefits of long term investment strategies.
“We were expecting an increase in switching,” Navigator managing director Marc Mengler says.
“As the last significant market downturn was years ago and investors are coming off the back of strong markets at the end of the nineties, we were unsure if they were going to run for cover,” Mengler says.
Navigator suggests the figures show that advisers are spending a lot more time communicating with clients, answering their questions and proactively educating them.
“Although investors are not happy with their returns, they are realising that you get cycles in markets and that we are undergoing a severe one,” says Mengler.
The expectation was that most portfolio movement would be from aggressive equities, such as international shares, back into stable markets including bonds and cash, but Navigator claims the movement has not been clear-cut.
“The movement of equities has been surprising. I would say that more than anything we have seen a movement from balanced to sector-specific investments,” Mengler says.
“It appears that clients have taken this opportunity to touch base with their financial advisers, seriously look at their portfolios and make sure they are satisfied with their strategy.”
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