IW Capital research finds investors choosing start-ups over stocks amidst turbulent trading
Amidst a barrage of pressure surrounding the UK’s ongoing relationship with the EU, the potential implications that Brexit may bear on nationwide investment agendas provides an early-stage insight into the direction of private wealth as Brexit rumbles on. New data revealed by IW Capital this month shows that investors remain undeterred by the forging of the UK’s path outside of the single market, and instead, are favouring private sector targets over traditional stocks and shares. The data proves contextually relevant amidst recent turbulence across the FTSE, following the 2.6% drop to 7,141 in early February which wiped out all the gains from this year’s trading.
Unveiled as part of IW Capital’s Vested Investor report, which sampled 1200 investors, the data revealed that one in five investors said that, with regard to their investments in 2018, SMEs were more attractive to them over traditional stocks and shares as through them they would be able to have a direct impact on the society they live in. This shift in sentiment is acutely more evident in London, where 40% of investors wanted to affect the world around them through the private sector, instead of engaging with more traditional equities markets.
The British Business Bank also released new figures last week showing that bank lending to SMEs has taken a sharp drop of £2.3bn, with alternative finance leading the charge in supporting UK entrepreneurs; the value and number of SME equity deals rose significantly, up 79% and 12% respectively last year. Manifestly, the latest funding figures have contributed to the number of new businesses being created rising to a record 414,000. Due to this continual growth, the UK investment population now navigates a landscape of opportunities and social factors which enables a far greater sense of responsibility than that of a decade ago. It is, therefore, unsurprising that 36% of investors now believe the ethical, social or environmental impact of the company they are investing into is just as important as the financial return.
The Vested Investor Report 2018 provides a nationally representative body of data that unveils a majority of investors now have an overwhelming commitment to investments that progress society, and that we are now more obliged to make conscious investment decisions. If you would like to learn more about socially progressive investments speak to a member of the IWC team today on 020 7015 2250.