Offshore advisers lose confidence

Offshore financial adviser confidence has dropped by 14% in Q4 2011, reports research by Skandia International. However, according to Skandia International’s Adviser Confidence Barometer report, advisers based in Asia reflect a much more positive mood.

Singapore-based advisers were the most upbeat, whilst advisers in the UK displayed the greatest nervousness.  Skandia International reports that respondents from the UK were the only ones to consider the outlook for the global economy as more positive than the shape of their local market; all of the other surveyed advisers displayed a stronger bias towards their local economies.
 
What’s worrying at least a third of offshore advisers is the fear of global contagion, which they still perceive to be the greatest economic threat to their local regions. A combined 40% report a belief that rising unemployment and inflation levels could have a more imminent detrimental impact.
 
As many as 55% of advisers feel their clients have become more risk averse over the past three months, whilst 47% reported a reluctance by clients  to invest at all. The ongoing Eurozone crisis seems to be taking its toll on investors locally, with 65% of European advisers believing their clients had become more risk averse over the quarter and 61% stating their clients were unwilling to invest at all. Only 4% of respondents felt that their clients may be prepared to take more investment risk, which is significantly down from 17% last quarter. Skandia International says that the uncertain economic outlook, coupled with the increased volatility in stock markets around the globe, explains why half of all surveyed advisers stated their clients chose to invest less during the last quarter.  
 
However, some investors are looking to take advantage of buying opportunities. Over 10% of offshore advisers reported an increase in the number of clients wanting to make regular investment contributions, whilst 7% reported seeing a higher demand for lump sum investments. Skandia International believes the most significant encouraging finding was that the vast majority - 97% of respondents -  confirmed their clients were riding the storm rather than trying to sell their investments and crystallise any losses.
 
The Offshore Adviser Confidence Barometer research was conducted by Skandia International in Q4 2011 and attracted responses from over 450 advisers based in  Hong Kong, Singapore, Dubai, UK, Europe, Africa and Latin America.

www.skandiainternational.com