Investors to move from cash in 2011

Australian investors plan to move out of cash and into the market in 2011, as many plan to rebalance their portfolios, according to CoreData.

The Australian Cash Report released by CoreData found one quarter of the respondents are looking to rebalance their portfolios to hold less cash — almost doubling in the past 12 months.

Of those planning to move into other assets, almost 40 per cent would move their cash into property, 26 per cent would buy shares and 11 per cent would purchase managed funds, according to the report.

CoreData found Australians generally believed the investment environment was improving, but most continue to choose retail deposits over other investment vehicles due to high returns and low risks.

There has also been a jump in the number of people who haven’t made their investment decisions for 2011, which CoreData principal Andrew Inwood sees as a big marketing opportunity for Australian Deposit-taking Institutions (ADIs) looking to attract new investors.

“Our report shows there is a massive pot of money that cash-heavy investors want to re-allocate,” Inwood said. “They just do not know where to put it and are waiting to be convinced by a proactive ADI on how they can boost their yield by moving their liquid funds,” he said.

Investors also rated the ‘big four’ as more trustworthy than tier two banks — a gap Inwood said would widen in the future.