NZ investors seek safety in investments

financial services council

9 August 2022
| By Laura Dew |
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Individual investors in New Zealand are steering clear of investment with higher potential risk/return with only 13% looking to areas such as cryptocurrency.

Research by the Financial Services Council (New Zealand) for its ‘Money and You’ report found 65.8% of 1,601 people surveyed said they wanted to ‘safeguard their wealth’.

Over half (52.3%) said they invested in a five-year time horizon and 32.7% said they preferred to invest in investments which had a higher potential return even if the risk was higher.

Just 13.3% said they invested in asset classes that were less available such as cryptocurrencies or NFTs. This result was heavily weighted among those in a younger demographic with 36.6% of investors under 39 saying they ‘strongly agreed’ compared to 9.3% of those aged over-50.

Almost three-quarters of respondents ‘agreed’ or ‘strongly agreed’ that crypto was a risky investment and the FSC said this had increased as their value fell with Bitcoin and Ethereum down more than 50% from the highs of late 2021.

However, there were concerns around how much people understood the nature of risk and return with only 10.5% of people saying they had a ‘very good’ understanding of the risk and return profiles of different investments and 16.4% having a ‘very good’ understanding of the relationship between risk and return.

These were down from 13.9% and 21.3% respectively in 2021. 

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