NZ investors seek safety in investments
Individual investors in New Zealand are steering clear of investment with higher potential risk/return with only 13% looking to areas such as cryptocurrency.
Research by the Financial Services Council (New Zealand) for its ‘Money and You’ report found 65.8% of 1,601 people surveyed said they wanted to ‘safeguard their wealth’.
Over half (52.3%) said they invested in a five-year time horizon and 32.7% said they preferred to invest in investments which had a higher potential return even if the risk was higher.
Just 13.3% said they invested in asset classes that were less available such as cryptocurrencies or NFTs. This result was heavily weighted among those in a younger demographic with 36.6% of investors under 39 saying they ‘strongly agreed’ compared to 9.3% of those aged over-50.
Almost three-quarters of respondents ‘agreed’ or ‘strongly agreed’ that crypto was a risky investment and the FSC said this had increased as their value fell with Bitcoin and Ethereum down more than 50% from the highs of late 2021.
However, there were concerns around how much people understood the nature of risk and return with only 10.5% of people saying they had a ‘very good’ understanding of the risk and return profiles of different investments and 16.4% having a ‘very good’ understanding of the relationship between risk and return.
These were down from 13.9% and 21.3% respectively in 2021.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.