There is a sharp divide between financial advisers in the north and south of England about the levels of uncertainty around Brexit, research from Aegon has found.
With official figures from the Office for National Statistics (ONS) underlining a north-south divide when it comes to wealth and income, research from Aegon demonstrates that the proportion of assets advisers are choosing to place in different types of investment strategies is linked to levels of affluence.
Single versus multi-asset
Advisers in the wealthier south of the country are opting to place a higher proportion (35%) of assets in bespoke portfolios created using single-asset funds.
This compares with 21% in the north.
Reflective of a more tempered risk appetite, a higher proportion of assets in the north (51%) are being placed in to multi-asset funds.
This compares with 34% in the south.
Attitudes to Europe
Reflecting the falling investment confidence amid Brexit uncertainty in the south of the country, European equities are predicted to perform well by just 2% of advisers in the region, compared to 12% of advisers in the north who expect this asset to generate strong returns.
Similarly, double the number of advisers in the south (28%) compared to the north (14%) expect cash to be the worst performing asset over the next 12 months, demonstrating the increased nervousness around Brexit felt more strongly in the south of the country.
In the north, advisers have a more cautious view of global markets as reflected in Aegon’s research, with 15% of those in the south putting greater emphasis on emerging market equities, compared to 10% of those in the north.
Tailor made solutions
Nick Dixon, investment director at Aegon, commented: “The contrast shown in our research demonstrates that advisers are tailoring investment recommendations to suit needs of clients in their location.
“The north/south political and economic divide is widely known and it’s interesting to see this impact investment strategies that advisers are opting for, with single asset funds and DFM portfolios attracting a greater share of assets in the south, while multi-asset is favoured in the north of the country.
“We believe this dichotomy is driven by three features of difference between the north and south of the UK – perceptions of Brexit, wealth and affordability, and risk appetite.”
