Investors eye global markets
Australian investors believe global markets will rise over the next year and are cooling in their outlooks for the domestic stock market, according to the inaugural Certitude Global Investing Intentions Index (CGIII) produced by Investment Trends this month.
The CGIII surveyed nearly 800 leading investors, including high net worth (HNW) individuals, self-managed super funds (SMSFs) and higher income investors, and found that 68 per cent expected global markets to rise versus just 19 per cent who anticipated a decline.
The research also found that Australian investors were looking to increase their international equities allocations by up to 70 per cent.
Commenting on the research findings, Craig Mowll, CEO of Certitude Global Investments, said it confirmed a shift among leading Australian investors who were demanding greater international exposures in their portfolios.
"Local investors now know there are limitations to their current allocation to assets, particularly the strong bias to domestic assets, and they are beginning to appreciate there is 98 per cent of the universe that presents very good opportunities," he said.
"Many institutions actively topped up their overseas allocations some time ago either through locally based managers or by dealing directly with offshore funds, or investing directly in offshore assets.
"The leading [HNW] investor is now following that lead."
Mowll added that while it was more difficult for HNW individuals and SMSFs to access these markets and assets, that did not diminish the desire to diversify.
"We're now at a point where 39 per cent of investors are saying they need more international assets in their portfolio," he said. "And more than half of those investors (52 per cent) are planning to make overseas investments in the next six months."
Yet Mowll said that he was also not oblivious to the fact that market and exchange rate volatility were concerning for Australian investors searching for global investing opportunities.
"That volatility is a worry for local investors is not a surprise," he said.
"However, our research also indicates that many Australian investors do not feel sufficiently well-informed to make offshore investment decisions, with 21 per cent citing a lack of knowledge as a barrier to overseas investing.
"Global investment opportunities need to be fully understood before investing," Mowll continued.
"Volatility is outside investors' control but having the right information is easier to achieve with the right partner.
"Our due diligence aims to do the leg work and research so investors and advisers don't have to."
Originally published on SMSF Essentials.
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