Rich individual investors in Asia Pacific are among the least loyal, and most frustrated, by their digital platform experiences, according to a global report.
A major reason for their dissatisfaction is because their financial providers have not realized their digital and investing behaviours are distinct from other regions, Refinitiv found.
Indeed, 22% of Apac investors are willing to switch platforms within a year because of their poor digital experiences. They identify several enhancements that would help, ranging from ease of use when navigating the platform to better data capabilities, the provision of analysis and visualisation.
Their requirements are also changing fast: 32% say they are more likely to need investment advice than six-to-12 months ago, “so it is surprising that at a time when investor reliance on investment advisors should be growing, their loyalties to their providers are in fact loosening,” noted the report.
Digital
Called “The Gold Standard of Wealth Management: Redefining investor experiences in Asia-Pacific”, the report surveyed over 500 mass affluent investors in Australia, China, Hong Kong, Japan and Singapore to understand how investors’ trading activities, data needs and digital expectations are evolving.
Almost a third of investors use at least three digital channels to manage their investment accounts, twice the figure in north America (16%). Already, 59% now use apps to access their investments and 41% rely on mobile websites.
Perhaps unsurprisingly, 69% want the analysis they are sent to be adapted by their providers for mobile and smartphone.
Almost a third want to see all their investments, including those held at other firms, in one place on a single dashboard, while a similar proportion say clearer product navigation would support their trading activities.
“[But] a sub-standard digital experience has not just failed to meet investor expectations in the region – it is actively encouraging them to look elsewhere,” said the report.
The report also highlighted how investors in Asia are reliant on a wide range of analysis, with different preferences visible in each market.
As much as 69% of investors in China value macroeconomic analysis (of global and national economic data), compared with only 29% in Hong Kong, where security and mutual fund analyses are instead preferred. In Singapore, all four types of analysis (macroeconomic, security, mutual fund and technical) are almost equally important.
Strategy preferences
Investors in the region follow different investment strategies, splitting almost evenly between growth and value investing (33% and 30%, respectively). However, they are far more likely to be attracted to momentum investing in other regions (17% versus 9% across the rest of the global sample).
More than half of clients already have exposure to ETFs in their portfolios in Hong Kong, Japan, Singapore and China, chiefly to experience the upsides of global stock market performance.
Yet, the survey results also indicate that ETFs are considered attractive because they permit access to specific sectors, and this advantage is more important in Apac than in other regions.
This pinpoints future innovation possibilities. ESG investing is also becoming more popular, with 48% of the Apac sample saying they are “increasingly enthusiastic” about it.
However, “with change happening fast, they readily acknowledge that they are new to this area,” noted the report.
Providers need to use more targeted content to educate investors about these investments and specific areas of interest within ESG, such as the association with growing sectors and good governance, Refinitiv suggested.
“But they must also appreciate how clients in the region like to learn about ESG and the information they trust most,” it said. With 44% of investors reliant on digital media to find information about ESG they will need a mix of podcasts, blogs, webinars and in-depth insights to improve their understanding.
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