Powered by MOMENTUM MEDIA
investor daily logo

Advisers split on managed funds

  •  
By
  •  
3 minute read

Live survey defies research

Despite projections of the demise of the asset class, more than half of attendees at the Vanguard Adviser Forum have indicated ongoing preference for managed funds.

In a live survey of the 300 financial advisers in attendance at the Sydney event yesterday, 51.88 per cent indicated they intend to use managed funds more than direct investment options in the future.

Addressing the forum, Vanguard Adviser Services head of intermediary distribution Michael Lovett said the live survey findings showed that "while the majority may still be in managed funds, direct investment is catching up."

Drawing on recently released research from Vanguard in association with Rice Warner, Mr Lovett said the general investment trend was away from managed funds - as well as cash - and into direct listed investments.

==
==

Mr Lovett also offered the audience some advice in executing the shift.

"When making the shift to direct investment there are a couple of things you need to keep in mind," he said.

"While you eliminate management fees when you do away with managed funds, you are taking on other risks such as diversification and added costs of trading, so you may want to consider [exchange-traded funds] as a diversification tool," he added.

More broadly, the live survey found that 49.79 per cent of respondents had a "hopeful" feeling about investment markets, with 33.05 per cent registering "positive" feelings and only 1.67 per cent indicating they are feeling "fearful."

Mr Lovett said that these findings were reflective of general market sentiment. "We're seeing this sort of a response both from advisers and investors; our call centres are busier than they've been in a long time," he said.

"The environment for investor concern has clearly altered, whether or not the market itself has changed as much is a question I pose."

On asset allocation, 81.86 per cent of respondents said they will be recommending a "diversified portfolio" in 2012, with 9.28 per cent indicating preference for "Australian equities" and 7.17 per cent choosing "international equities," with only 0.42 per cent support for "term deposits."