Over two thirds of IFAs (69%) are in favour of the UK remaining in Europe, while 31% believe the UK would be better off voting ‘out’, according to a survey conducted at GAM’s IFA conferences across the country.
For 34% of respondents, politics is the biggest risk factor for 2016, followed by global economic recession at 22%, the Euro crisis at 16%, and a Chinese debt implosion at 14%. A liquidity crash and the risk of the Federal Reserve lifting rates too quickly were also identified as risks.
Europe is still in favour with IFAs for equity investment, with almost half of respondents (48%) expecting it to deliver the best returns for the remainder of 2016. The US and emerging markets trailed with a 16% equal split of votes, while Japan and the UK stood at 15% and 6% respectively.
Charles Hepworth, investment director at GAM responsible for developing and managing outsourcing solutions for UK IFAs, said: “Given the uncertainty around the ‘in-out‘ referendum and the potential for Brexit, we have a relatively cautious outlook on UK equities and are currently positioned moderately underweight. Sterling is likely to come under renewed pressure as investors are worried about the UK’s economic prospects.
“Europe remains the most favoured investment region for IFAs and we believe that many of the structural imbalances in the eurozone have now been corrected. One of the managers we hold in this space sees the best investment opportunities in Spain and Ireland, where the level of domestic demand has corrected to such a degree that a multi-year bounce in internal demand is inevitable.”
The annual GAM UK IFA roadshow hosted more than 100 IFAs in Newmarket, Birmingham, Chepstow and London during March.
GAM is one of the world’s leading independent, pure-play asset managers. It provides active investment solutions and products for institutions, financial intermediaries and private investors, under two brands: GAM and Julius Baer Funds. The core investment business is complemented by private labelling services, which include management company and other support services to third-party institutions. GAM employs over 1,000 people in 11 countries with investment centres in London, Zurich, Hong Kong, New York, Lugano and Milan. The investment managers are supported by an extensive global distribution network.
Headquartered in Zurich, GAM is listed on the SIX Swiss Exchange and is a component of the Swiss Market Index Mid (SMIM) with the symbol ‘GAM’. The Group has assets under management of CHF 119.0 billion (USD 118.9 billion)*.
* Source: GAM. Data as at 31 December 2015.