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US market entices Aussie financial advisers

Financial advisers are increasingly showing demand for United States-based assets as they move out of cash toward growth investments, the latest Investment Trends survey has found.

Having conducted a survey of more than 700 Australian financial planners between July and August 2013, Investment Trends concluded that while multi-region funds remain the most sought-after option for gaining international exposure, US equities and other assets are gaining popularity.

“The last few months have seen a shift in global economic performance as the developed economies continue to recover while the pace of growth in emerging markets slows,” said Investment Trends senior analyst Recep Peker. “That’s encouraged a renewed investor focus on developed markets in general and the US in particular.”

Asked about which regions they would encourage clients to invest in over the next 12 months, 40 per cent of respondents listed the United States or North America, up from just 10 per cent in 2009.

Interest in China is dwindling at the same time, with the proportion of advisers opting for single-region Chinese exposure falling from 35 per cent in 2010 to 12 per cent in 2013.

However, lack of access to franking credits is still listed as a deterrent to global investment, with 43 per cent of respondents describing this issue as a “barrier”.