Market Research

Asian Investors More Willing To Put Money To Work; Big Risk Appetite Variations - Schroders

Vanessa Doctor Asia Correspondent 24 May 2013

Asian Investors More Willing To Put Money To Work; Big Risk Appetite Variations - Schroders

As confidence in markets returns, Asians are now more ready to allocate an average of €50,000 ($65,000) of new money in various investments in the next 12 months, a new report by Schroders reveals.

In the latest "Schroders Global Investment Trends Report," the UK-headquartered firm found that almost 60 per cent of the over 4,000 investors polled in seven Asian markets are more confident about investment opportunities in 2013, compared to the previous year. The survey covered responses of some 14,800 investors from 20 countries with at least €10,000 ready to invest over the next year.

Around 79 per cent of Asian investors said they were planning to increase or maintain the same amount of investment over the next 12 months. Those planning to boost their investments expect to raise the amount by an average of 5.5 per cent.

However, this interest in investing is somehow doused by aversion to risk. Among the seven countries surveyed, investors from Indonesia had the highest mean appetite for risk, with 31.7 per cent, followed by Thailand, 30.5 per cent, and Hong Kong, 30.2 per cent. On the other hand, the biggest number of investors preferring low-risk investments came from South Korea, 44 per cent, followed by Singapore, 42 per cent, and Japan, 41.6 per cent.

Fifty-five per cent of the Asian investors who participated said they believe their own country will offer the best growth potential. Seventy-seven per cent said they are prepared to invest in equities in the next 12 months.

The difference in Asian investors' desired investment outcomes and their approach to investing itself may be attributed to how they obtain their investment information, Schroders said. In the study, over 60 per cent of Asian investors rely on their own judgment, family and friends and news sources to make decisions. Only 25 per cent said they would seek professional advice.

"These variables make it increasingly difficult for investors to construct their investment portfolio alone. Investors in Asia should consider making better use of professional financial advice to help them formulate a truly diversified, long-term income focused portfolio," commented Richard Mountford, chief executive for Asia-Pacific at Schroders.

Forty-one per cent of the respondents said political issues influence their investment decisions, followed by the eurozone debt crisis, 40 per cent, a weak global economic recovery, 38 per cent, increasing inflation, 27 per cent, and a weak economy in their own market, 34 per cent.

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