The Schroders UK Financial Adviser Survey 2024 has revealed a jump in the proportion of advisers planning to put their clients into multi-asset funds.
Among advisers planning to outsource investments, 35% intend to allocate to multi-asset funds, up from 27% at the same time last year.
Schroders said this is at least in part being driven by concerns over capital gains tax (CGT), with the government putting the rate on investment gains up in the Budget.
The twice-a-year survey, which took in views from 293 advisers across the UK this time, also revealed that in response to Consumer Duty 35% of advisers are looking to increase the use of outsourced discretionary model portfolios.
The shift in outsourcing plans is taking place within the context of a wider move from cash back into investments. Schroders found the percentage of advisers reporting that their clients are now investing or considering investing has risen to 67%, up from 49% in May.
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Within this, 36% of advisers now anticipate increasing their allocations to UK equities and 34% to developed international equities.
Advisers are ‘cautiously optimistic’ about market performance, with 23% expecting higher equity returns compared with long-term historical averages.
Of the advisers quizzed, 57% anticipate increased global growth, but this optimism is tempered by concerns over potential volatility, with 70% expecting heightened geopolitical disruptions over the next five years and 43% predicting higher market volatility.
The current environment may have affected client sentiment, as the percentage of advisers reporting a bullish outlook among their clients has decreased to 34%, down from 41% in May 2024. The figure remains markedly higher than the 17% recorded in November 2023.
The survey also highlighted a continuing concern among advisers regarding intergenerational wealth transfer, with 62% worried about losing assets as wealth transfers across the generations. Just over half (53%) are reporting an increase in the average age of their clients over the past five years.
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Another area the researchers questioned advisers on was artificial intelligence (AI). More advisers are adopting AI, with only 10% stating they do not expect to utilise it, a significant decrease from 27% in May 2023. The survey also found 21% have already implemented some form of AI technology in their business.
The survey has now been carried out for 15 years, and has taken in a number of major shifts in the advice landscape over that time.
Gillian Hepburn (pictured), commercial director at Benchmark, part of the Schroders Group, said: “Celebrating the 15th anniversary of this survey offers a chance to reflect on the significant changes in our industry since 2009 when we were emerging from the credit crunch and in the middle of implementing the Retail Distribution Review (RDR).
“As an example, a key debate in 2009 was the use of a single platform where 90% of the advisers surveyed believed they could put all their business onto one platform. The platform market has matured significantly and the 2024 survey indicates that only 18% rely on a single platform for new business.”
Jamie Fowler, head of regional and advisory sales at Schroders, added: “The market landscape has seen a number of shifts over the last 15 years, presenting challenging conditions for investors.
“It is particularly encouraging to see this year’s results reflecting a renewed sentiment towards investing, with advisers increasingly focusing on equities and seeing opportunities especially within the UK.”
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