UK: 88% of Advisors Recommend SPs Over the Next 12 Months

by Nick Rice
FT Advisor

IFAs have said they will increase their allocation to structured products more than to any other mainstream asset class over the next year, according to Keydata Investment Services.

A Keydata telephone poll of 50 advisers this month revealed 88.1 per cent would recommend that clients put more money in structured products over the next 12 months. Just 2.4 per cent of advisers would recommend clients maintain their current weighting and 7.1 per cent would tell clients to decrease it.

Other defensive asset classes will receive lower boosts. Cash was the most heavily favoured after structured products, with 83.3 per cent of advisers recommending clients increase their exposure, 9.5 per cent saying they should maintain it and 2.4 per cent suggesting they decrease it.

Fixed income received a higher recommendation than pure corporate bonds. Sixty-nine per cent said they would advise clients to increase their weighting to fixed income against 38.1 per cent for corporate bonds.

Cautious Managed funds, which have seen high inflows over the last year, would see allocation increases from 66.7 per cent of IFAs, less than fixed income as a whole. UK equities, international equities and property were at the bottom of the recommendation list at 16.7 per cent, 14.3 per cent and 4.8 per cent, respectively.

Mark Owen, director of sales and strategy at Keydata, said he had anticipated a large move into fixed income and cash, but was surprised at the allocation to structured products, although Keydata itself is a structured-product provider.

He said the move indicated a greater awareness of structured products among advisers, particularly in terms of their return profiles and objectives.

For the full article from FTAdvisor.com, click here.