Investors confident despite ‘economic headwinds’: CA ANZ
Australians are looking to increase the scale of their investments over the next 12 months despite inflation and global political unrest, according to new research.
The latest CA ANZ Investor Confidence Survey highlighted a motivation to expand investments and the importance of independent auditors.
The survey consisted of everyday investors and retail investors, half of whom expressed a level of confidence.
The survey ran from 12–27 June 2024 and included more than 1,000 investors who hold more than $10,000 in the share market and other investments.
CA ANZ confirmed independent auditors are critical when providing retail investors with confidence in the current uncertain economic climate and political unrest.
CA ANZ reporting and assurance leader Amir Ghandar FCA said independent auditors are being trusted by investors in the current market.
“In tumultuous economic and political times, investors are looking for a clear, reliable view into their investments and they trust independent auditors’ reports to assure this view, alongside financial analysts, stock exchanges and government regulators,” Ghandar said.
“The survey shows that retail investors are overall more confident than last year, in both domestic and overseas capital markets and importantly, Australia’s own publicly listed companies.”
“Interestingly, confidence in the ASX topped the reasons driving their optimism.”
According to the survey results the percentage of investors with “some or more” confidence increased by 4 points to 87 per cent, while 78 per cent of investors confident in the capital markets still sit at a healthy level.
Confidence in domestic publicly listed companies was found to be higher, as 90 per cent of respondents expressed “some or more” confidence, up by 5 points from last year.
Ghandar said the survey encapsulated “mums and dads” who look at the “bigger picture” when looking to invest.
“Of course, this is a survey of mum and dad investors who are looking at macro trends rather than day traders whose confidence might bounce between rock bottom and sky high in a day, or even an hour,” he said.
“Overall, we can see that retail investors have confidence in the markets and the protection that independent auditors deliver.”
The results reflected that inflation is still viewed as the biggest economic risk and the main contributor to a lack of confidence in Australian capital markets.
Confidence in the Australian government has also declined as a direct result of the lack of confidence in the capital markets, according to the data.
Investors put their trust in auditors as audited financial reports provide the “bedrock” for good decision making, Ghandar said.
“It’s notable that 90 per cent of responding investors have confidence in audited financial reports because audit is the unsung hero when it comes to assuring reliable and trustworthy information to businesses, investors, journalists and market observers,” he said.
“The challenge for auditors is to make their reports more accessible through improved digital reporting so that retail investors can be more informed, whether investing locally or globally.”
