Planners’ expectations for 2013 revealed

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Investment Trends Chief Operating Officer Eric Blewitt says volatility in the markets has forced planners to change their expectations for the year ahead. His comments come as findings from the 2012 Investment Trends Adviser Product and Marketing Needs Report, which examined Australian financial planners and their investment product needs, including cash, managed funds and ETFs, are released.

The report is based on a survey of 822 financial planners from July to September 2012. It shows record levels of flows into cash, with the average planner estimating their client base to have $5.4 million sitting in excess cash, up from $3.9m in 2011. Collectively, planners are holding about $78 billion in excess cash, up from $56bn in 2011.

“Volatility in markets at home and abroad has lead planners to revise their market return expectations downward,” said Blewitt. “Financial planners now expect the value of the All Ordinaries to increase by just 7% over 2013, versus 8% for 2012 and 10% for 2011.”

Flows to managed funds are still dropping but appear to be levelling out. Inflows to managed funds dropped from 52% in 2010, to 46% in 2011, but only dropped to 41% in 2012.

Inflows to offshore assets remain steady at 26%, despite planners’ expectations for an increase to 29%. Twenty-eight percent of planners intending to recommend international investments to clients said they would encourage investment in the US/North America, up from 21% in 2011.

International funds covering multiple regions remain the most popular recommendation from planners to clients intending to obtain international diversification for their portfolios (49%, down from 57% in 2011).

Satisfaction with the five fund managers used the most by financial planners was in the following order:

Overall satisfaction ranking

Fund manager






AMP Capital Investors


Colonial First State



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