Italian HNWI investors are among the most pessimistic in Europe about investment returns in 2016, according to a survey conducted by Legg Mason Global Asset Management.
The survey, conducted among more than 5,000 Italian HNWI investors aged 40 or older across 19 countries, revealed that only 55% of Italians are optimistic about investments, which is the lowest European percentage after France (51%).
This is a sharp drop from last year’s figures, when 63% of Italian investors were optimistic about investment prospects.
The investment process could be derailed on the back of recent volatility, according to 86% of Italian investors. On the other hand, 42% of Italians say global economic instability could harm investments, as 24% are concerned about local economic instability.
Central bank decisions on interest rates impact investment judgement of 55% Italian investors, while 45% consider economic indicators such as GDP, wages or unemployment rate.
This may explain why 56% of Italian investors is more focused on short-term returns, making up the highest percentage in Europe, which has a regional average of 39%.
Moreover, 79% of Italian investors admit to have a conservative approach when investing, which confirms a far from unscrupulous attitude, and 77% is more risk averse compared to one year ago.
Prudent investments also derive from uncertainty about portfolio moves: 62% of Italian investors is worried about fully understanding products invested, while the European average is 56%.
So, why invest? Primary investment goals for Italians are numerous: 68% wants to enjoy a comfortable life, 53% seeks to build a retirement nest egg, 48% wants to build an inheritance for children and heirs, while 25% affirms as main goal save for children’s education: it is the highest percentage in Europe (13% UK and Sweden, 18% Germany, 19% France).
“Financial markets turbulences over the past years can justify the low level of optimism of Italians about investments returns. But it is in the light of this complexity that investors must use expert players able to give advice on the markets able to offer returns and educate them on products and investment strategies,” said Marco Negri, country head for Italy at Legg Mason.