INDEPENDENT financial advisers (IFAs) are the most trusted source of external investment advice, but investors are still more likely to trust their own judgement, new research claims.
A survey by property finance firm Minerva Lending found that almost three quarters (72 per cent) of active investors prefer to take the advice of an IFA. However, the vast majority of active investors (77 per cent) said that they would rather trust their own judgement. Three in five (60 per cent) said that they would be more likely to trust word of mouth.
This will be good news for the peer-to-peer lending sector, which is not currently represented in the IFA community. However, platforms such as Octopus Choice have been wooing advisers by launching dedicated IFA portals.
The survey also found that investors still prefer traditional investment advice over newer fintech solutions. Only 12 per cent of the investors surveyed said that they would trust a robo-adviser to offer financial guidance, and just 22 per cent would trust a standalone piece of software.
Minerva Lending plc conducted a survey of 1,000 UK adults aged 36 and over with at least £50,000 of investable assets in June 2017.
“IFAs should be genuinely encouraged that nearly three quarters of active investors would trust them to make investment decisions on their behalf,” said Ross Andrews, director of Minerva Lending. “For robo-advisers and software-based investment management tools, the survey results are less uplifting. It seems that far more people with bigger sums to invest trust manual decision-making processes, whether by themselves or an IFA.”
Just 35 per cent of respondents said that they would trust a stockbroker, suggesting that active investors are increasingly focused on diversifying their portfolios beyond stocks and shares.
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