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Public is still wary of equities

Active investors have faith in the stockmarket but the general public still prefer property, according to a sur-vey by the Association of Investment Trust Companies.

The research reveals that 71 per cent of active investors believe the stockmarket will outperform the housing market, up from a figure of 52 per cent last October.

Forty per cent of the general public believe property is the best way to make returns, the same level as six months ago, compared with 11 per cent backing the stockmarket to give better returns.

The figures show that 58 per cent of active investors plan to increase their stockmarket exposure over the coming months, up from 46 per cent six months ago, while just 4 per cent of the public plan to do so.

More than a quarter of active investors say their confidence in equities has been buoyed by recent stockmarket rises.

Four out of five investors are putting their money into UK companies, with 33 per cent believing the smaller companies sector is the most attractive area. However, 69 per cent of the public do not have and Isa and have no plans to take out an Isa this year.

AITC communications dir-ector Annabel Brodie-Smith believes investors need to get out of the habit of buying when prices are high as regular investing removes the emotion involved when making a decision to invest and gives consumers lower risk.

She says: “We are surprised that despite much media coverage on the supposed instability of the housing market, the man on the street still seems turned off equities. The investment ind-ustry needs to work together to help restore confidence in equity investment, and education has an extremely important role in this.”

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