Barclays Stockbrokers reveals investors shift towards caution

Edited by the Insidemoneytalk editorial team Mar 20, 2007

Barclays Stockbrokers sees shift to Money Market and Income funds

Despite market volatility, Asia remains a popular sector Following recent market volatility, Barclays Stockbrokers today revealed its top selling funds for February 2007, and found that investors are moving towards investing in Money Market funds and more cautious sectors - the top selling fund by assets was Fidelity Investment Services Cash Fund.

However, despite the general trend towards more cautious investments, many investors are still seeking opportunities in Asian and Japanese Funds and these remain two of the most popular sectors.

But investors are not being turned off equity investing - research amongst Barclays Stockbrokers clients* has found that 67% mainly have their ISA in equities, while 33% is in funds and Investment Notes.

Amy Nauiokas, MD and Head of Barclays Stockbrokers, commented: "Although the Specialist Market sectors such as Asia continue to be popular with our clients, there has been a marked shift towards more cautious investments with Money Market funds being the top selling sector in February".

"Investors are clearly seeking security in cash like products during volatile markets and clients with high cash balances are also trying to find alternatives to low interest rates".

"It is encouraging that investors are not being put off investing in equities and at Barclays we have reflected the cautious outlook of our clients by launching an Investment Note linked to the performance of the FTSE 100 index." Henk Potts, Equity Strategist, Barclays Stockbrokers comments on current market conditions: "With this year's ISA deadline fast approaching, we think the current volatile market conditions provide an ideal opportunity for medium-term investors to use their tax-free allowance to buy large-cap UK shares or capital protected investments like Investment Notes".

"We see the recent turmoil as a correction rather than as crash or even as the peak of the bull market".

"Despite current concerns we see little chance of the US economy falling into recession and still think global growth will remain reasonably robust".

"Like the market, we also think corporate profitability is likely to hold up, with analysts still estimating profits growth of around 7% this year".

"We would recommend investing in sectors whose companies offer international diversification with strong, reliable earnings streams".

"We advocate the pharmaceuticals, banks and life insurance sectors as offering good value at the moment." Top 20 purchased funds in February 2007, 1 Fidelity Investment Services Cash Acc - Money Market, 2 Schroders Unit Trusts UK Mid 250 A Acc - UK All Companies, 3 Fidelity Investment Services Moneybuilder Income - UK Corporate Bond, 4 Standard Life UK Smaller Companies Acc Retail - UK Smaller Companies, 5 Gartmore Fund Managers China Opportunities - Asia Pacific excluding Japan, 6 Artemis European Growth Acc - Europe excluding UK, 7 Henderson Global Investors European Smaller Companies - European Smaller Companies, 8 Aberdeen Property Share A Acc - Specialist, 9 Jupiter Emerging European Opportunities Fund - Global Emerging Markets, 10 Artemis UK Special Situations - UK All Companies, 11 Blackrock Gold and General Acc - Specialist, 12 Invesco High Income Acc -UK Equity Income, 13 Aberdeen Asia Pacific A Acc - Asia Pacific excluding Japan, 14 Aberdeen Emerging Markets A Acc - Global Emerging Markets, 15 First State Investments Greater China Growth - Asia Pacific excluding Japan, 16 Artemis Income Acc -UK Equity Income, 17 Jupiter China Acc - Asia Pacific excluding Japan, 18 Invesco Income Acc -UK Equity Income, 19 Lazard UK Alpha Retail Inc - UK All Companies, 20 Invesco Japan Acc - Japan.

Top 10 sectors on Barclays Fund Market in February 2007: Money Market, UK All Companies, Asia excluding Japan, Japan, UK Corporate Bond, UK Equity Income, Specialist, Europe Excluding UK, UK Smaller Companies, Global Emerging Markets.

For further information contact: Caroline Wells / Nicola HankeyPR, Barclays Wealth 020 7114 7435 / 020 7114 9813 Or Chantal Heckford/Katie HaywardLansons Communications020 7294 3639/3631chantalh@lansons.com/katieh@lansons.com.