Intermediaries are becoming more positive on equities as investors’ appetite for risk increases, according to research from Axa Investment Management.
A survey of 56 advisers, conducted ahead of the group’s investment summit event, shows that the majority (64%) expect equities to generate the best returns over the next six months. However, the popularity of fixed income was not a short-term flight to safety, as the asset class remains an intrinsic part of clients’ portfolios, according to 71% of advisers.
More than half of respondents (53%) say they have seen renewed risk appetite among clients as returns on bank deposits have plummeted.
Intermediaries are optimistic on the prospects for the FTSE 100 in the near future, with 70% saying it is either very likely or quite likely that the index will finish the year higher than its current position.
At the regional level, almost three-quarters (69%) of respondents say East Asia offers the best investment opportunities. At the sector level, global equities are popular, with just over half of those surveyed (52%) expecting to recommend the asset class to clients in the next six months.
Finally, more than half (52%) say they have remained in actively-managed funds rather than seeking shelter from volatile markets in passive vehicles.
Rob Bailey, the firm’s head of UK sales, says the survey demonstrates that investor appetite has improved along with the increasing opportunities in equities, high yield and the inflation-linked bond markets.