Taiwanese are most active investors among their Asian or global peers, but have incurred heavy losses second only to their Japanese counterparts since the global financial crisis began in 2008, a survey by Schroder Investment Management Taiwan Ltd showed yesterday.
On average, Taiwanese respondents said they plan to invest 45,427 euros (US$58,500) in equities, bonds, mutual funds and savings this year, accounting for 235 percent of per capita income, said Schroder Taiwan, the local arm of the British fund manager Schroders PLC.
That figure is higher than the 217 percent recorded for the Asia-Pacific region and the 186 percent worldwide, according to the survey.
The survey compiled answers from 14,800 investors in 20 markets between March 28 and April 12. It defined investors as people — mostly between the ages of 25 and 54 — who intend to invest more than 10,000 euros over the next 12 months.
“The survey results indicate that Taiwanese are more passionate about investment than other nationalities,” Schroder Taiwan CEO Francine Wu (巫慧燕) said.
However, that passion has proven unprofitable for the past five years as Taiwanese investors have seen their portfolios contract 11.9 percent on average in the period, second only to Japan in terms of loss and deeper than the 6.6 percent decline in portfolios in Asia and the 4.9 percent drop globally, the survey found.
Wu attributed the losses to insufficient risk diversification, saying that Taiwanese tend to concentrate on a limited range of investment tools.
About 83 percent of Taiwanese investors have exposure to equities, compared with 78 percent among their Asian peers and 69 percent among global investors, the survey said.
A lack of long-term investment strategies also makes Taiwanese vulnerable to short-term market volatility, Wu said, citing the survey’s finding that 37 percent of Taiwanese investors in the poll plan to adjust their portfolios within one to three months and another 32 percent within three to six months.
Another 22 percent of those polled intend to shift investment targets within six to 12 months and 9 percent expect do so within one month, the survey said.
“Investors with short-term strategies tend to win small, but lose big,” Wu said.
In addition, Taiwanese tend to not depend as much as other investors on professional advice, since only 20 percent of those surveyed said they use the services of wealth management analysts, middleman agencies or banking managers, lower than the 25 percent among Asian investors and 33 percent for global investors, the survey found.
Instead of seeking expert advice, 27 percent of the Taiwanese respondents gather their investment information from media reports, while another 17 percent rely on family members and 16 percent on themselves, the survey said.
While 67 percent of the Taiwanese respondents are eying long-term gains, only 20 percent have investments that provide retirement solutions, much lower than the 32 percent of their Asian counterparts or 42 percent of their global peers, the poll showed.
“Local investors should assign more importance to retirement planning, given the nation’s rapidly aging population and extending life span,” Wu said.