Australian investors adjust approach as market volatility continues: HSBC survey

Australians continue to turn to the sharemarket for wealth generation despite continued market volatility, according to a new survey from HSBC which also shows close to 80% of investors have made an investment in the past six months.

The HSBC Investor Insights survey of more than 1,100 Australian investors found that over two in five (41%) own equities outside of their superannuation fund. Men (31%) were more likely than women (25%) to have invested in equities in the last six months, and Millennials (31%) have been more active in trading in equities than their Baby Boomer counterparts (24%).

The research also found that 73% of Australian investors have changed their investment approach in the last 6 months, with 36% of investors becoming more balanced in their investment approach and only 9% taking a more aggressive approach.

ETFs and Managed Funds pique investor interest

While equities make up the lion’s share of Australian investor portfolios, there is a growing preference for other investments – namely bonds, ETFs and Managed Funds.

Donahue D’Souza, Head of Investments for HSBC Australia, said: “The HSBC Investor Insights survey indicates that while investors are still seeing value in direct share investments, many are adjusting and diversifying their investment approach in response to changing market conditions.”

“One of the more interesting findings was the preference to consider bonds, ETFs and Managed Funds due to a view they require less time and effort to manage.

“Given this growing interest, we expect to see a greater diversity of ETFs and Managed Funds becoming available in the next few years together with investors being given the tools to better track and monitor ETFs,” said Mr D’Souza.

Seeking opportunities abroad

According to the survey, almost half (48%) of Australian investors are likely to consider investing outside of Australia in the next six months.

“Certain global markets are feeling the effects on inflation and other macroeconomic impacts more than others, opening up opportunities for Australian investors to consider sectors, industries that they may not be able to access in Australia.”

“However, while interest in international investments is high, half (50%) of Australian investors don’t know or are unsure how to do this. Positively, many are turning to market research (36%) and financial advisors (30%) but these findings indicate there is opportunity for greater investor education regarding investment opportunities outside of Australia,” said Mr D’Souza.