Financial Forecasts - Mapping out a plan for 2003
In this major special feature a series of experts look at what 2003 holds for advisers and investors
Friday, February 21st 2003, 1:08PM
Recently we asked experts to provide some predictions about what advisers and investors can expect this year.
Several clear themes emerge in the articles, plus in interviews conducted with other major industry players.
Firstly the losses of the past few years are nearly unprecedented and on par with the Great Depression of the 1920s. Consequently, investors have become more conservative.
As Guardian Trust Funds Management's Fergus McDonald says, "the investment public have entered into an age of conservative investing,"
This new age has caused a shift in asset allocations, and while people have run to defensive portfolios they have also learnt that that risk is more than volatility of returns - it involves actual loss of capital.
People are looking for upside. As BNZ's manager of investment strategy Geoff Mason says in his economic commentary analysts are painting a far rosier picture than what may actually occur. This has been helped by the fact that the end of last year and start of this year has seen some strong upward movement in share markets.
Consequently, some people are already talking about the next bull market.
Advisers also have to be particularly aware that many of the mainstream media are going to be quite focussed on highlighting the poor performance of markets.
ISI chief executive Vance Arkinstall and AMP Financial Services general manager Ross Kent strongly make the point that the industry as a whole is going to face a deal of public criticism over issues such as fees, performance and service. How are you going to deal with that?
On the positive side the Government is making some moves in the superannuation area which are encouraging (albeit slow) and the multi-billion New Zealand Superannuation Fund is likely to have a positive impact on the local sharemarket.
One of the biggest issues facing the broader financial services industry this year is tax. While it may not be the most riveting of subjects some of the plans the Government has hatched impact on everybody, from fund managers to advisers and investors.
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