Equities remain asset class of choice but half of investors unsure of next investment

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New research* from Legal & General Investments, one of the UK’s largest investment providers, reveals that despite investment being down across all asset classes, equities still remain the asset class of choice.

New research* from Legal & General Investments, one of the UK’s largest investment providers, reveals that despite investment being down across all asset classes, equities still remain the asset class of choice.

However, more than half of investors (51%) do not know which asset class they will invest in over the next six months. The findings come from Legal & General Investments’ annual What Matters Investment Index, which examines investors’ views of the market over the coming year.

Interestingly, decisions on asset class allocation differ depending on whether financial advice is taken. Only a quarter (26%) of investors who allow their adviser to act on their behalf plan to invest in equities over the next six months.

In contrast, almost half (49%) of investors who buy direct, without the use of an IFA, are planning to make an equity investment. In addition, the multi manager approach appears to be far more popular among investors advised by their IFA with 13% planning to invest in the next six months, compared to only 5% of those not using an IFA.

This year’s index finds that investment in all asset classes is down in comparison to 2010. Equities remain the favoured asset class with 76% of investors investing in these products, down from 82% in 2010. Property features in the fewest portfolios with only 16% of investors highlighting that they are invested in this asset class (down from 20% in 2010).

Simon Ellis, Managing Director, Legal & General Investments, said:

“With the increased volatility in the markets it is no surprise that consumers are unsure of their next investment move. This year’s index shows that every single asset class, whether equity or fixed income, has seen a decline in demand. This suggests investors could have positioned themselves in cash products, awaiting the return of stability to the market.

“It is also interesting to see the disparity in asset class preference between investors with and without financial advisers. Whether using an adviser or buying direct, it is imperative that investors do their research before making investment decisions.”

The Legal & General Investments What Matters Investment Index aims to investigate the future expectations of the everyday investor.

Media Enquiries:
Izabella Siemicka
PR Manager – Investments
020 3124 2092
Izabella(dot)Siemicka(at)lgim(dot)co(dot)uk

*Figures from YouGov Plc. Total sample size was 2,024 adults that have invested in unit trusts and/or investment trusts and/or Equity ISAs. Fieldwork was undertaken between the 30th of August and the 01st of September 2011. The survey was carried out online. The average portfolio size for the sampled investors was £93,458.

Notes to Editors:
The information contained in this press release is intended solely for journalists and should not be relied upon by private investors or any other persons to make financial decisions.

1)LGIM manages £362 billion in assets for more than 3,000 clients as at 30 June 2011.

Registered Office: One Coleman Street, London, EC2R 5AA
Registered in England 1009418.

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Rhys Phillips
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