Offshore equity expectations higher than ASX
Active share investors are more confident in the performance of offshore markets over the next 12 months than the ASX, according to equity research company Skaffold.
Skaffold surveyed 100 active investors and found that over half (50.4 per cent) were interested in increasing their investments in international shares, while 43.4 per cent were undecided — a sign that figure may increase in the future, Skaffold said.
Its research found that 45.6 per cent believed global markets would offer the best growth opportunities over the next 12 months, compared to 9 per cent who were pitting their hopes on the ASX. Over two thirds (68.1 per cent) thought the US market would be the best place to seek opportunity.
The majority of respondents (63.2 per cent) said the drawcards for international shares included a great range of stocks (18.9 per cent), the US market (8.5 per cent), increased asset classes including technology (5.7 per cent) and emerging markets (3.8 per cent).
But an inability to access individual stock research rated as the number one factor (20.9 per cent) keeping investors from increasing international share allocations. Other reasons included knowledge, currency risk and the absence of franking credits.
Skaffold general manager Chris Batchelor said the company had experienced increased demand for access to cost-effective, quality research on global shares from advisers and institutional investors, while it expected its SMSF client base to increase.
"We think also that the well documented growth of the SMSFs will increase demand for access to an affordable, easy-to-use tool to help investors identify stocks that fit their investment profile," Batchelor said.
More than half of those surveyed held global stocks either as direct equities (25 per cent) or via a managed fund (28.7 per cent), with almost 41 per cent of those holding international shares in their SMSF.
Recommended for you
Infrastructure assets are well-positioned to hedge against global uncertainty and can enhance the diversification of traditional portfolios with their evergreen characteristics, an investment chief believes.
Volatility in US markets means currency is becoming a critical decision factor in Australian investors’ ETF selection this year.
Clime Investment Management is overhauling the selection process for its APLs, with managing director Michael Baragwanath describing the threat of a product failure affecting clients as “pure nightmare fuel”.
Global X will expand its ETF range of exchange-traded funds next month with a low-cost Australian equity product as it chases ambitions of becoming a top issuer of ETFs in Australia.
