One in five IFAs believe stock market falls experienced this year are merely isolated incidents, say...
One in five IFAs believe stock market falls experienced this year are merely isolated incidents, says a survey commissioned by Witan Investment Trust.
A study of 100 financial advisers suggests declining markets are taking their toll on intermediary firms as 52% of respondents now claim to be more cynical of markets than they were before, and 80% do not expect markets to improve before mid 2003.
Almost one quarter (24%) still argue the stock markets are the best way to grow wealth, but the impact of continuous losses means at least 68% of advisers have seen less than 10% of their clients put money into collective investment schemes over the last three months.
It's hardly surprising, given that the FTSE 100 has fallen 18% this year. Yet six out of ten advisers (58%) still believe the turnaround may not be far away as they believe clients will use their full 2002/2003 Isa allowance.
Most favoured investment option at this stage is still equities, as 38% of advisers expect assets to go into equities, 17% in fixed interest, 10% in corporate bonds and 8% in cash.
Given the chance, 68% of advisers would still recommend investing in equities over any other sector, because it offers the best long-term returns.
Commenting on the study, Witan Marketing Manager, James Budden said, "Whilst confidence has taken a hit, there are some strong messages coming through here. The majority of intermediaries are undoubtedly more cynical of markets than they were a year or so ago, but the good news is that they remain optimistic.
They remain committed to equity investment for the long-term and, from the Witan perspective, they increasingly recognise the role which global growth trusts have to play as the bedrock of a client's investment portfolio."
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