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Trustees to lift offshore exposure

One in seven SMSF trustees planned to increase their allocation to international equities in the next year and of those already invested globally, 28 per cent would boost their exposure, according to a report from Zurich.

The “Global Investment Opportunities: SMSF Trustee Attitudinal Study” revealed 51 per cent of trustees aimed to lift their international equities exposure through managed funds, while 27 per cent preferred to invest directly and 11 per cent stated they would use exchange-traded funds.

However, the report, conducted by CoreData, found the shift to offshore could be greater if education and advice were improved.

Fifty-one per cent of SMSF trustees said they would consider international equities if they had access to education and low-cost advice on the asset class, it said.

Furthermore, 44 per cent of trustees indicated they preferred financial advisers to be the main source of education, followed by accountants at 15.5 per cent and stockbrokers at 16.7 per cent.

When asked what education channel was preferred, 57 per cent of trustees indicated they wanted online learning, while 28 per cent wanted written materials.

When asked if education was likely to overcome their concerns regarding international equities, 57 per cent of trustees indicated “very much so”, the report said.

“The study found a mixture of inertia, ignorance and pessimism has held back investors thus far,” Zurich Investments national sales manager Linda Stangherlin said.

“Encouragingly, however, there are signs of a detectable shift in mindset, amongst both individual investors and SMSF trustees.

“Not only is there an underlying intent to move money out of cash and into overseas equities, but more interestingly, there is a very real appetite to do it via managed funds.

“By identifying the barriers and the subsequent ways to overcome them, the results of this study can provide valuable guidance for advisers seeking to chart a path for their clients, and individual investors and SMSF trustees alike.”

The research was based on a survey of 505 respondents, consisting of 163 SMSF trustees and 342 individual investors, conducted in August.

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