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Advisors plan to increase equity allocations as mutual funds remain the favoured investment vehicle for overseas exposure


Many financial advisors plan to increase the allocation of client assets to domestic equities, emerging market equities and global developed market equities in 2011, according to a study conducted on behalf of Aberdeen Asset Management Inc by Harris Interactive in March.


The online survey polled more than 800 financial advisors across wirehouses, regional brokerage firms, independent wealth management shops and other investment advice providers.

When asked to indicate a preferred vehicle when increasing allocations to international or emerging markets, 60% of advisors stated that open-ended mutual funds were their preferred vehicle for investment; 24% of advisors stated a preference for exchange-traded funds (ETFs) when investing in international or emerging markets.

Commenting on the survey’s findings with respect to increasing US equity weightings, Paul Atkinson (pictured), Head of North American Equities at Aberdeen, says: “These results are in keeping with investors’ renewed confidence in the US equity market. US companies have weathered the past year well and have been producing solid earnings growth backed by an improving labor market and a strengthening economy.”

Gary Marshall, Chief Executive at Aberdeen, adds: “We believe that the survey reveals two forces at play. One shows investors’ increased risk appetite for equities in general, which is consistent with the findings of other studies. The other is the widening of investor appetite from a previous strong ‘home country’ bias to a more diversified international portfolio. We see advisors seeking to diversify client assets to access the growth potential of developing economies.”

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