High risk investors reluctant to invest

Investors with a higher tolerance for risk have indicated they will be significantly less active in markets in the next three months, according to CoreData’s Q1 2014 Investor Report.

The report found this is due to the decline in positive sentiment about economic and market conditions.

This finding is in direct contrast with results from the end of 2014 when high-risk profile investors were considerably more likely than average to be active in investment markets.

The research also revealed that only one in five respondents are satisfied or very satisfied with the returns their cash assets have achieved in the past year.

Despite this, three in five investors intend to leave their cash investments at the current level, while one in 10 plan to increase their cash allocation.

High-risk profile investors are leading the movement away from cash, with one in five high-risk investors intending to adjust their allocation away from cash compared to just 7.8 per cent of conservative investors.

Of the minority of investors who are looking to reallocate their cash to other asset classes, the most popular destination is direct Australian shares, favoured by more than one in three overall, closely followed by residential property, popular with slightly more than one in four.

The research found that high and moderate risk profile investors are close to twice as likely to reallocate to shares as conservative investors, while close to half of conservative investors will look towards property.

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