Investors falling out of love with buy to let, seeking alternatives

A new survey of UK-based investors reveals the outlook for alternative investments amid growing concerns over the state of the economy.

The study, from investment platform Shojin, was small - just 721 UK adults - but each has an investment portfolio worth in excess of £10,000.

Three in 10 said the fact that the UK seems poised for a lengthy recession is leading them to consider alternative investment assets.

The research also found that a third of respondents are looking beyond traditional investment strategies due to concerns over the government’s handling of the economy. Among investors aged 18 to 34, the figure climbs to 59 per cent.

When asked about the resilience of alternative assets in the economic climate, 29 per cent of investors believe alternative assets are less likely to feel the impact of political and economic disruptions.

Despite the appeal of alternative investments among many investors, Shojin’s study revealed there is a major barrier. Over half find it challenging to determine the best way to gain access to alternative asset classes.

Jatin Ondhia, the chief executive of Shojin, says: “It has been a bumpy ride to stability across financial markets. Economic volatility has become turbulence and markets are now braced for a lengthy recession, with our research showing there is a notable demand among investors for asset classes that can offer their portfolios resilience and the potential for higher returns.

“While alternative investment strategies have been steadily gaining traction in recent years, our research shows there is a renewed emphasis on diversification strategies motivated by concerns over inflation, interest rates, recession and the government’s economic policy. This is likely to accelerate alternatives’ move into the mainstream.

“However, the research also revealed there is a significant knowledge gap among investors, which is impacting their exposure to alternative asset classes. As ever, investors will need to conduct thorough due diligence, consider their risk appetite, weigh up their strategies and choose investment partners carefully to ensure their portfolio aligns with their investment goals, particularly in the current climate”.

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