Private investors are shifting their portfolios towards equities, while at the same time there has been a gradual decline in those choosing fixed income investments, according to research from Lloyds TSB Private Banking.

Lloyds TSB polled 1,000 investors in its latest Investor Outlook survey and found that 17 per cent increased their exposure to equities in the first six months of 2013, while just 9 per cent cut their exposure.

The research also found that investors have been less attracted by fixed income investments. During the first half of 2013, just 5 per cent of investors increased their exposure to government bonds, while 6 per cent decreased. Meanwhile, 5 per cent increased exposure to corporate bonds, while 9 per cent decreased.

“Investors have recognised the improving outlook for global equities, and are starting to adjust their portfolios accordingly. While we would caution against over-exposure to any one asset class, our general view is that investors are heading in the right direction by tilting their portfolios towards the stock market and away from bonds and commodities at this time," said Ashish Misra, head of investment strategy at Lloyds TSB Private Banking.

"Prices have recovered in July, and our current view is that equities will continue to outperform fixed income or commodities. This is due to an improving macro-economic backdrop, with rising indicators in manufacturing activity, labour markets, house prices and general financial conditions. As long as these conditions continue to prevail, we believe good relative valuations will continue to favour equities," said Misra.