Investments  

Advised investors have UK bias despite underperformance

“The UK market is too cheap compared to others, the US too dear. Sterling is too low against say the Euro and should continue to regain poise against the Dollar so all in all, what with our post-Brexit recovery and the domination of our markets by ‘value’ not ‘growth’, it’s a pretty great place to be in our book.  

“There could also be a global passives-led market collapse as well and we want to avoid the worst of that if we can.”

The research also found about a third (36 per cent) of investors had less than 25 per cent of their portfolio invested in the UK.

But about a quarter (26 per cent) of those surveyed said they did not know where their money was invested.

Tom Kean, director at Thameside Financial Planning, said: "There is a lot of debate about what makes a good asset allocation, and I’ve never read any kind of wide consensus on the numbers.

"What is too heavy UK for some, is too light for others. And as the research says, there are plenty of good reasons to be overweight UK.

"The UK looks like good value from most angles, just as long as some of the tail winds continue."

Justin King, independent financial adviser at MFP Wealth Management, added: "We have advised on global portfolios since 2000 and allocate a percentage to each country’s market cap," he said. “We exclude markets that are difficult to trade on because of liquidity and cost but our portfolios' country weighting look very similar to the AWCI. 

“Our clients have benefited from this approach but that was without skill from me, just that the normal weighting to the USA has been very beneficial.”

sonia.rach@ft.com

What do you think about the issues raised by this story? Email us on FTAletters@ft.com to let us know