Investors remain wary

Australian investor sentiment is recovering with many people exhibiting a more positive attitude towards domestic equities, but most investors remain wedded to the more conservative options of cash and gold, according to the latest ING Investor Dashboard Sentiment Index.

The index, released today, revealed that Australian investor sentiment was on the rise after plunging last quarter, but was still lagging many of its neighbours.

In fact, the ING research revealed that Australia was the third most negative country in the pan-Asia region — behind Japan and Korea.

Discussing the data, which revealed that 84 per cent of Australian investors believed the market for Australian equities would rise or remain stable, ING Investment Management head of sales Jim McKay said it was encouraging that sentiment was picking up.

However he noted that despite the more positive attitude to equities, investors were still favouring cash and gold.

When asked where they would invest on the risk/reward spectrum, the research revealed a definite weighting towards the safer end.

“It is interesting that there seems to be a disconnect between what investors are thinking and what they are doing,” McKay said. “The fact that they expect the equity market to improve, yet prefer cash and gold, perhaps shows that continued volatility in markets is still making them nervous.”