Investors become sheepish and cash becomes king
Australians have increasingly become more conservative than their global counterparts, with cash overtaking real estate and equities as the major assets class, according to new research.
The data suggests that the amount of Australians, over the age of 40, who are very conservative jumped to 84 per cent, up from last year's 77 per cent, while the global average is 64 per cent.
Legg Mason's 2016 Global Investment Survey was based on the views of 5,370 affluent investors, across 19 key markets, "highlighting the impact of prolonged global uncertainty."
It showed among ‘core investors', Australians' shifted their dominant asset classes in 2016, with cash at 28 per cent overtaking real estate investment at 25 per cent and domestic equities at 22per cent.
Legg Mason's global head of distribution marketing, Matt Schiffman said, ‘While Australians have long been considered conservative in their investment approach, the increased aversion to risk, focus on longer-term cash, domestic market and real estate, highlights that investors are looking at investment in safe-houses."
The survey also found older Australians were less likely to invest internationally, compared to other nations, with only two per cent saying they will focus on overseas investments, compared to the global average of 22 per cent.
When it comes to where to invest around the globe, Australia was seen to be the second most attractive place after the US. The land of green and gold beat Latin America, ASIA, UK and Europe. Legg Mason pointed out that overseas investors flock to Australia, as it has one of the lowest investment risks in the world, behind Singapore.
In regards to retirement savings, the report showed that only 20 per cent of Australians ‘realistically' save for their retirement, and that Australia is one of the most expensive places in the world to retire, viewed to cost US $714,000, behind the USA at US$1,000,000 and Hong Kong at US$903,000.
Recommended for you
Bell Financial Group has announced a 44 per cent decline in half-year net profit after tax but record funds under advice as it transitions into a diverse wealth management business.
Having predicted three ETF trends for Australia at the start of this year, State Street has shared how these are tracking and whether Australia will successfully reach US$30 billion ETF inflows for 2025.
Magellan fund manager Nikki Thomas is to depart next month as the firm reviews its range of global equity funds and transitions her High Conviction fund.
Sydney-based alternative fund manager East Coast Capital Management has formed its first advisory council as it enters its next phase of growth.
