September 27, 2024
SINGAPORE – Investors here are adopting a more conservative investment stance compared with their peers in Asia and the Middle East, noted a report out on Sept 26.
It found that 42 per cent of Singapore investors favoured a steady-as-she-goes approach, with only 24 per cent opting to be aggressive.
By contrast, investors in other parts of Asia and the Middle East were more bullish, with 30 per cent playing it safe and 34 per cent adopting a fairly or very aggressive approach.
In terms of asset classes, most investors in Singapore prefer to hold stocks and equities, followed by real estate, bonds and fixed income as well as cash and cash equivalents, said Swiss-based financial services provider Avaloq, which conducted two surveys in February and March to compile the report.
One polled 3,012 investors aged 18 and above across Europe, Asia and the Middle East. More than half had investable assets of US$250,000 (S$321,000) to US$1 million, while 40 per cent had US$1 million to US$30 million, and 4 per cent had more than US$30 million. Another surveyed 341 wealth management professionals in the same markets.
The findings noted that most investors in Singapore checked their investments at least once a week and more than half planned to use their returns to grow their wealth further and plan for retirement.
Investors here are still lukewarm towards crypto and digital assets, citing a lack of knowledge, perceived volatility and low trust in crypto exchanges as key reasons for not investing in them.
Even as environmental, social and governance issues gain traction globally, 31 per cent of investors in Singapore put their money into such opportunities as many still question their sustainability.
Investors are also less satisfied than their peers elsewhere when it comes to the digital experience provided by their main financial institutions.
Mr Vibhooti Chaturvedi, regional director and head of South Asia at Avaloq, said the more conservative investment stance in Singapore could be due to the larger pool of older investors.
Despite this more conservative outlook, Mr Chaturvedi noted that investors here are willing to take a more aggressive approach if they feel bankers can grow their wealth and meet returns.
Investors want to be engaged and demand faster responses from bankers, but wealth managers are struggling to provide this, given the lack of the right technology. This has led to distrust between investors and their bankers, he added.
Around 47 per cent of Singapore investors have at one time considered switching their wealth management advisers because they either failed to provide the expected returns or did not embrace new technology to service them.
The problem is heightened when 67 per cent of wealth management professionals here use outdated technology, while 62 per cent find it difficult to find the information they need and only 21 per cent say the technology they use works seamlessly.
About 80 per cent of the wealth management professionals in Singapore agreed that artificial intelligence (AI) will be critical to how they work in the future, even though they think local investors will never trust AI for investment responsibilities and financial planning.
Such professionals here appear to face bigger struggles than their peers elsewhere when it comes to technology, with 43 per cent relying on 10 or more specialist technology systems or applications for their daily work, compared with 25 per cent globally.