Dubai: The number of UAE investors adopting a 10-year-plus strategy has significantly increased and that of investors choosing a short-term investment strategy continues to decline, according to the latest Friends Provident International (FPI) Investor Attitudes Report.
The study shows that UAE investors are adopting longer-term investment strategies, with the percentage of respondents opting for a ten-year-plus strategy almost doubling since the last survey conducted in the third quarter of 2011.
The trend suggests that consumers are taking responsibility for their future and saving over the longer term to achieve their financial goals, the study said.
Against the backdrop of the European sovereign debt crisis, and an unpredictable political landscape across the Middle East and North Africa (Mena), the latest FPI Investor Attitudes Report shows that the Friends Investor Attitudes Index for the UAE has fallen just two points and it now stands at 15 points.
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This is the smallest decline across the three countries (Hong Kong, Singapore and the UAE) surveyed and the UAE still shows the most positive sentiment.
UAE investors have demonstrated a cautious approach showing preference for ‘safe haven' investments such as gold, and a significantly increased preference towards risk-averse strategies.
"The slight fall in the Friends Investor Attitudes Index for the UAE is understandable given the continuing turmoil in global investment markets. However, the drop of just two index points reflects a growing maturity among UAE investors, who — it is clear from the report — are taking a longer-term approach to investing and consequently appear less concerned about short-term market fluctuations," said Matthew Waterfield, general manager, Middle East and Africa at Friends Provident International.
Compared with Hong Kong and Singapore, where the Investor Attitudes indices have dropped to new lows, the UAE index shows the most positive investor sentiment.
The index for Hong Kong, which was stable at 15 points in the previous two surveys, fell sharply to 11 points.
The sentiment in Sing-apore has continued its slide, with the index at 12 points having fallen from its highest level of 21 points and 16 points in the previous two surveys.
Interestingly, the preference for investing in collectables, such as works of art, classic/vintage cars etc has plummeted and this is now the least-preferred asset class in the UAE.
In the latest survey, only about 30 per cent of investors viewed the current market as improving, 11 per cent less than the previous survey.
Investors also view the prospects for the UAE investment market in six months' time less favourably, with 9 per cent more respondents having an unfavourable outlook than in the previous survey.
The report also shows that affluent respondents are more likely to invest outside of the Middle East to mitigate the impact of political changes in some countries in the region.
When choosing investment funds, 58 per cent of UAE respondents view past performance as the number one criteria for selecting a particular fund, followed by risk ratings (56 per cent) and fund charges.