Hong Kong retail investors are becoming more reliant on professional advice when developing their investment goals and strategies, but many are still getting their advice form other channels such as media and celebrities, according to a recent survey by ING Platform Services.

ING Platform Services considers it a good sign that 46% of investors it surveyed would rely on independent financial advisors (IFAs) as a source of advice, showing that their importance and role are rapidly evolving.

However, at the same time, while most investors consider themselves independent decision makers, some still lack investment analytical skills and that signals growing opportunities for qualified professional advisors to offer tailor-made investment advice based on investorsÆ evolving personal circumstances and investment objectives, ING Platform Services says.

Nearly half, or 48%, of the investors surveyed are currently relying on media and celebrity commentators as a source of advice, 39% rely on relatives and friends, while 46% of participants rely on independent IFAs.

ING Platform Services says investors do not fully realise that although media and celebrity commentators are well-known and may provide insightful advice, their guidance is generally based on broader trends and perspectives and do not take into consideration individualsÆ investment profile such as personal goals, constraints and tolerance for risk.

Approximately one-third, or 34%, of those surveyed said they only trust themselves when making investment decisions. The survey results also reveal that 38% of investors would
redeem their mutual funds if the value fell by 20%. This highlights the nervousness and short term focus of investors during volatile markets.

With experience in mutual fund investment averaging only 5.5 years among Hong
Kong investors, ING Platform Services predicts expanding business opportunities for IFAs to take on the role of strategic investment advisors. Investors who seek advice from IFAs, consider professional knowledge, credibility and reputation as their most important requirements.

ôWe are encouraged to see that more Hong Kong investors agree that financial intermediaries can be relied upon as well-informed, closely following market trends and able to assist clients in constructing an investment portfolio to meet their personal objectives.ö says Matthew Williams, head of sales and marketing, at ING Platform Services.

The survey also highlighted that Hong Kong investors are getting more sophisticated in terms of understanding the importance of asset allocation and portfolio diversification. Higher transparency and more integrated services are needed and most investors also call for tools that can empower them to keep a closer monitor of their investment portfolio, ING Platform Services says.

Around 90% of respondents found a transparent track record of all service charges appealing. Close to 80% of them would like to have a consolidated report for all mutual fund investments and an online platform that provides anytime access to fund performance and asset allocation.

The survey was commissioned by ING Platform Services and conducted by Synovate. A total of 502 telephone interviews were conducted from August to September, including 401 current mutual fund investors and 101 non-mutual fund investors.

ING Platform Services is the service provider of I-WRAP, which is a transaction recording, portfolio valuation and reporting service for financial advisors and their clients.