ISA Investors Continue to Seek Returns From Equities Despite Increased Caution

In the midst of prolonged market volatility, investors still see opportunities for better returns by investing directly into the markets, according to research from Barclays Stockbrokers. Investors intend to place the overwhelming majority of their ISA investments (89%) next tax year into risk-based investments. Moreover, equities remain the most popular investments for Barclays Stockbrokers clients, with banking stocks and other financials continuing to dominate.

The research found two-thirds (66%) of investors surveyed had invested in an investment ISA this tax year, and of those almost half (45%) had invested the full £7200 allowance. The majority of investors (85%) are planning to invest into an investment ISA in the next tax year (2009/10) with just over two-fifths (41%) believing they definitely will.

However, there are a significant number of customers (41%) who are more cautious than they were previously. In response to investors’ demand, Barclays Stockbrokers has seen a 187% increase in investment note uptake this year compared to the same period in 2008.

At a time when many investors are unsure of which direction the FTSE index may be moving Barclays Stockbrokers is launching the Five Year Target Return Investment Note from 23 March 2009. The Investment Note offers a return of 55% at maturity in five years, payable provided that the FTSE 100 has not fallen at any time during the term below a level 50% from its starting point. However, capital repayment and the return will be reduced if the FTSE 100 has fallen below a level 50% from its starting point, in which case it must recover to starting level by maturity to avoid erosion. The note is available exclusively from Barclays Stockbrokers until 6 April 2009.


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