Investor sentiment continues to fall, with confidence in the economy remaining negative for the second quarter in a row, according to the Financial Services Council/CoreData Investor Sentiment Index.
The index showed that investor sentiment fell 0.5 per cent to reach -9 per cent in the third quarter of this year.
The sentiment index is now 16 points lower than at the end of 2009.
"While sentiment did not deteriorate significantly, it is clear investors remain uncertain about the future," Financial Services Council chief executive John Brogden said.
"Investor uncertainty is not surprising given the concerns about the European and US economies and the recent period of political upheaval resulting in Australia's first minority government in 70 years."
While 65.2 per cent of investors are reluctant to invest new money, satisfaction with their existing investments remained consistent with the last quarter at 37.7 per cent.
People who have made additional contributions to superannuation will continue to do so, with 76.7 per cent expecting to maintain their level of contributions over the next year.
Sentiment towards Australian shares strengthened compared with the residential property market in the quarter, with investors undecided as to which asset class is more likely to outperform, according to the index.
The index found that Australian equities (42.3 per cent), residential property (40.8 per cent) and cash (40.6 per cent) are expected to be the top performers among the asset classes this quarter.
Investors were most pessimistic over international shares in the quarter with only 22.5 per cent of investors expecting global shares to outperform.
Investors who use a financial planner or are with a superannuation fund feel more financially secure than those investors who do not use professional advice.
Just over half of people with an adviser felt financially secure compared with 43.4 per cent of those without an adviser.
