Sentiment collapses post-FOFA as sharemarket falls

global-financial-crisis/financial-planning/wealth-insights/research-and-ratings/financial-advice/FOFA/money-management/financial-crisis/

7 August 2013
| By Mike Taylor |
image
image
expand image

Financial planner sentiment has dramatically declined over the past three months amid a declining sharemarket and the reality of Future of Financial Advice (FOFA) implementation, according to the latest Wealth Insights data.

The latest Wealth Insights Adviser Sentiment Index released exclusively to Money Management has revealed the scale of the collapse in sentiment from a return to pre-global financial crisis (GFC) levels in November and December to the lows of 2011.

The index fell from 50 points in January/February to 36 points in July.

Wealth Insights managing director Vanessa McMahon pointed out that the proportion of advisers saying times are ‘bad' or ‘very bad' had doubled in the past two months from 6 per cent to 12 per cent.

She said this outcome seemed to reflect a number of factors including the markets and the realities confronting planners in implementing FOFA.

"Concerns around the work involved from the FOFA reforms, particularly the fee disclosure statement, is contributing to the drop in sentiment," McMahon said.

She said investor behaviour had also become slightly more conservative in the past two months with more advisers reporting clients were "staying put".

McMahon said the decline in sentiment over the past three months had been one of the most dramatic recorded by the index since the dark days at the height of the GFC. She said it was rare to witness a doubling of the number of planners reporting conditions as being ‘bad' or ‘very bad' — something which seemed a result of the pressures generated by FOFA and by some broader uncertainties.

McMahon said she sensed that there would be no general improvement in sentiment until there was greater clarity about underlying FOFA issues, the markets and the forthcoming federal election.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

1 month 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months ago

Entireti has unveiled the new name for the AMP financial advice businesses that it acquired last year....

4 weeks ago

A Sydney financial adviser has been permanently banned from providing any financial services, with the regulator deriding his “lack of integrity, trustworthiness and prof...

2 weeks 6 days ago

Minister for Financial Services, Stephen Jones, has provided further information about the second tranche of the Delivering Better Financial Outcomes (DBFO) reforms....

1 week 5 days ago

TOP PERFORMING FUNDS