Pandemic prompts search for alternative investment opportunities

Investors looking for alpha-generating alternatives uncorrelated to the economic cycle should consider life settlements, according to Cristina Lugaro, Director, Ress Capital and author of our guest feature this week.

With the world still grappling with a second wave of coronavirus infections, and investors on the hunt for truly uncorrelated investment opportunities, Lugaro believes the asset class has the potential to generate 'superior alpha'.

New research from TIME Investments meanwhile, reveals how investors are broadening their horizons in the search for attractive and reliable income to cover a fall in shareholder dividend payments by listed companies during the pandemic. 

In the search for income, the research shows that a third (32 per cent) of advisers are recommending an increased exposure to real assets such as infrastructure and real estate, one in four (26 per cent) have increased their recommendations for investing in renewable energy, and 24 per cent are increasingly recommending long income property.

The coronavirus crisis has also fuelled a significant increase in share trading activity among UK investors according to short and leveraged ETP provider GraniteShares with the company's latest research revealing that 12.7 per cent of the UK adult population has bought or sold shares since the start of the pandemic, and 37 per cent of those intend to increase their activity over the next six months.

"Thanks to the internet and technology providing better access to company information and market data, many investors clearly feel that the current volatile environment, has created attractive opportunities to buy stocks," says Will Rhind, Founder and CEO of GraniteShares.

Sticking with the coronavirus theme, new research from Quilter suggests that 25 per cent of over 40s are now able to save more than they did pre-pandemic, but almost three quarters of any additional savings are being held as cash rather than in investments. To help savers make the most of their money, Quilter's Tracy Crookes has produced a step by step guide aimed at novice investors.

Quilter also has new investor advice out this week aimed at those considering shifting from active to passive investment funds. As Quilter's Nick Wood points out though, investors still need to do their homework and should remember that not every index is the same. 

“Whilst passive investment would seem to take away the difficult decisions around selecting an outperforming manager, there are a still a number of factors investors need to consider to get the best outcome,” he says.

And our final advice this week comes from Phoenix Group which, as part of Talk Money Week, has come up with a list of tips aimed at preventing investors from falling foul of pensions scams. 

Wealth Adviser

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