Some 87 per cent of UK retail investors believe they lack sufficient levels of financial knowledge to better manage their portfolios.
Research by Charles Schwab found 81 per cent of retail investors believe it is increasingly important to seek expert advice.
It also revealed 58 per cent are in fact consulting financial advisers, a 7 percentage point increase from the year before, while 52 per cent are referring to the financial press to make investment decisions.
According to Charles Schwab retail investors are moving away from previously popular sources of investment advice such as ‘finfluencers’, celebrities and social media-based finance specialists and towards more traditional channels such as financial advisers and investment publications.
Since the end of 2021, the influence of social media influencers who specialise in finance has dropped by 13 percentage points, from 50 per cent to 37 per cent amongst Gen Z and by 10 percentage points among millennials from 52 per cent to 42 per cent.
Charles Schwab has highlighted a similar trend with celebrities who discuss their investments with their influence decreasing by 19 percentage points from 51 per cent to 32 per cent amongst millennials, and from 45 per cent to 35 per cent amongst Gen Z in the same time period.
Richard Flynn, UK managing director at Charles Schwab, said: “The current macroeconomic climate continues to shape the attitudes and behaviours of retail investors in the UK.
"Since we began this study at the end of 2021, domestic and international markets have experienced varying levels of volatility and uncertainty.
"It is therefore reassuring to see a rising and notable number of investors proactively seeking professional advice in order to make the most of their investments.”
This comes after a report from CFA Institute urged regulators to engage with ‘finfluencers’ to make them aware of the rules around financial advice.
The report, Finfluencer Appeal: Investing in the Age of Social Media, claimed a lack of financial literacy, limited interaction with regulated financial advisers and a preference for online information drove Gen Z to influencers.
It also stated influencers should be required to disclose their regulatory status.
alina.khan@ft.com
