Scott Payton

Like rabbits caught in the headlights

Humility, honesty and simplicity are what traumatised investors want from wealth managers, says Scott Payton

issue 27 June 2009

‘It’s a difficult world out there,’ admits Chris Kenny, investment director at Smith & Williamson, the wealth management and accountancy group. ‘There’s the recession, the economy teetering between inflation and deflation, higher tax rates, increased risk and lower returns all round.’

While market risks have soared, investors’ faith in the people charged with looking after their money has plummeted. ‘Private clients’ trust in investment managers has pretty much collapsed,’ says Kenny. ‘I don’t think many people in our industry have been good enough at apologising and saying “mea culpa” when things have gone wrong.’

So what exactly has been going on in wealthy investors’ minds while the financial world has tumbled around them? Between March and May this year, Barclays Wealth surveyed 2,100 high-net-worth individuals around the world to find out. On the positive side, 88 per cent said that they saw significant investment opportunities in the current environment. On the negative side, 68 per cent of these also said they were steering clear of the opportunities because they believed that the risk of further price falls was too high.

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