Growing adviser confidence in market performance and increased consumer desire for long-term financial planning are expected to bring beta back into client portfolios in the coming years, a BlackRock survey has suggested.
The Global Investor Pulse Adviser survey found that 80% of UK advisers were optimistic about the three year market outlook, while more than a quarter planned to increase their clients' equity exposure in the coming years.
The survey also found that a third of the 101 advisers surveyed in the UK thought their clients had become less risk-averse.
However, a parallel survey among investors found that half claimed they were unwilling to take any risks with their money.
BlackRock head of retail for Europe, Middle East and Africa Alex Hoctor-Duncan said the findings highlighted that consumers were still "paralysed with fear" but there was an "opportunity for the advice model to help people".
"The survey reveals there is likely to be a significant shift in portfolios as advisers look to help their clients take steps out of cash and seek simple investment solutions, which have a greater focus on the ‘outcome', to help deliver their clients' longer term investment goals," he said.
There was an alarming gap between consumers' expectations of their annual retirement income and the amount they thought they needed to save up in their pension pots, Hoctor-Duncan warned.
Clients of advisers were more in control of their finances and more confident in making the right investment and savings decisions than those consumers who don't seek financial advice, the survey showed.
However, uptake of financial advice is still low, about 14% of consumers in the UK are using a professional adviser, the survey found.
The opportunity to engage more people is in removing the "disconnect" with consumers and developing simple products, Hoctor-Duncan suggested.
He said: "There is a very clear message coming through from the consumer (interpreted through an advised look): 'we are all going to sit on cash until you guys figure out how to have a conversation with us, which says how much do I need to save, how long do I need to save for and, when I pick up the telephone and go 'how am I doing', I actually get an answer that makes sense.'
"And that's the opportunity."
Two global vehicles
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