Investors starting to get appetite for risk

TAMLYN STEWART
Last updated 05:00 26/02/2013

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Investors are starting to develop a bit more of an appetite for risk, the latest ASB investor confidence survey shows.

However, rental property remained "top of the pops" as the most attractive type of investment.

The confidence measure surveyed 660 investors in New Zealand and found that for the last three months of last year, confidence levels ended on par with the previous three month period, at a net 13 points.

ASB head of wealth advisory Jonathan Beale said the fact confidence levels held steady from the previous quarter meant investors were still the most upbeat they had been since the end of 2010.

"The positive thing we're seeing is a resurgence over time of managed funds in particular."

That suggested investors had a bit more of an appetite for risk.

"We're seeing it every day, people looking for advice, people are looking to invest their money differently to cash, with interest rates so low people are warming to managed funds.

"People are putting money into KiwiSaver, we're seeing that tick along quite nicely."

Confidence in that type of investment had been better than it had been for years, Beale said.

Rental property is viewed as being the asset most likely to provide the best returns for investors - up 1 point to 19 per cent of respondents.

"It has always been top of the pops," Beale said.

" I think there was one period during the GFC that people were running scared and moved into term deposits and savings accounts but other than that rental property - particularly in Auckland . . . has been a runaway success.

"And it just seems to be steaming away again."

Aucklanders remain most optimistic about returns on rental property with 24 per cent of Auckland respondents considering property as the most likely to give the best return, up 1 percentage point from the third quarter.

About 18 per cent favoured term deposits, up 1 point, and 12 per cent KiwiSaver, also up 2 points.

Outside Auckland, rental property and term deposits shared top spot on 17 per cent.

Managed investments and KiwiSaver were both up 3 points to 16 per cent and 15 per cent respectively.

Bank savings accounts have fallen significantly, down 4 points to just 5 per cent.

Monthly figures showed that international events still had a large impact on investors.

Investors had been optimistic in October when progress was being made on the eurozone debt crisis.

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- BusinessDay.co.nz

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