The majority of HNWIs in Australia are not getting the advice they need when it comes to ETFs and inter-generational planning, according to a report.
There are now around 490,000 HNW investors in Australia, with the cohort controlling around $2trn in investable assets, according to the 2019 Powerwrap/Investment Trends HNW Investor Report. The number has grown by 13% since 2017, while their assets have risen by 21%, in aggregate.
The report found that 58% of HNWs had unmet advice needs when it came to exchange traded funds (ETFs), inter-generational planning, and identifying undervalued assets.
ETFs are a popular one because the great thing about ETFs for high net worths is the low cost access to whatever you might want exposure to"
Investment Trends wealth management research director Recep III Peker said there was "actually a really wide range of topics" HNWs were looking for advice on, including ETFs and intergenerational planning.
"ETFs are a popular one because the great thing about ETFs for high net worths is the low cost access to whatever you might want exposure to. Things like particular parts of the US market, or the global economy or particular sectors," Peker told local media.
On adviser usage, 73% of HNWIs surveyed used a financial adviser. Almost 30% would use an adviser for access to wider range investors, and around 36% would use an adviser for a second opinion.
However, around 24% of HNWIs had stopped using an adviser because of poor outcomes, and a further 22% would not use an adviser because they could make better investment decisions. On trust, 21% of HNWs did not trust advisers and therefore would not use one.
HNW investors have reported as having negative expectations of capital growth for Australian stocks for the second time on record, with most (87%) being concerned with global macro-economic issues.
The other top concerns include the China slowdown (64%), a global share market crash (54 per cent) the White House administration (48%) and share market volatility (42%).
In an uncertain environment, Investment Trends noted, investors are becoming increasingly defensive in their asset allocations, seeking stable and predictable yield.
According to the report, just 25% of HNW investors believe the current range of products available to them is sufficient, with greater access to alternatives and private equity on their wishlist.