New research article - Australian investors’ preferences in the first quarter of 2022

This article is the second in a new thought leadership series from the team at LENSELL. Check the first article in this series here.

In this article, the team at LENSELL looks at Australian investors’ preferences in the first quarter of 2022, based on the data sourced from their partner Sharesight.

The article aims to understand how investors’ most popular choices are placed in comparison with general attitudes towards risk and with the general approach to seeking returns based on performance.

After analysing the Top 20 investors’ preference from several angles (risk & return, Beta, Sharpe ratio, diversification) the author highlights several insight points:

• Investors’ behaviour can change a lot in the course of a few months, with preferences changing within the same asset classes as well.
• While there is a lot of data available to support deep investigation and investment research, many investors seem to make only emotional decisions, follow word of mouth or online recommendations that do not make sense from a rational perspective.
• While 83% of investors only want to take medium, low or no risks at all, this list of Top 20 preferences indicates that many investors may actually take risks higher than they would like.
• Although investing in ETFs often gives the best diversification, investors need to beware of spreading money between ETFs that may actually be very correlated. Investing in these correlated ETFs will not bring about the intended level of diversification and further investigations are always needed, just the same as when investing in individual stocks.

Check out the full article at: https://www.sharesight.com/blog/whats-driving-investors-mind-or-emotions/ and contact the team with any questions at: [email protected]

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