British expats are feeling bullish about stocks and shares and moving their cash into equities, according to new research.
The balance in expat portfolios has slightly changed over the past 48 months, according to a study of investment attitudes by Lloyds Bank Private Banking.
Four years ago, expats divvied their cash into roughly 17.5% held as shares; 4.2% in corporate bonds and 2.3% in government bonds.
Now, that has shifted to 19% in equities; 3.6% in corporate bonds and 1.8% in government bonds.
According to the bank, the shift in attitude shows expats are more confident about riskier stocks and shares as they pull their cash out of safer bonds.
Confidence in British economy
However, the change is hardly throwing caution to the winds, even though 45% of expats reckon their portfolios are better balanced and more likely to yield good returns than two years ago.
A third agreed their portfolio was diversified, but a fifth were unhappy with the balance they hold.
Many expressed confidence in British equities – three-quarters were sticking with the stocks and shares they hold already, while one in six are still buying but one in 10 are selling.
Expats in the United Arab Emirates and Spain were more likely to hold a greater number of British equities than expats elsewhere, while those in Canada and New Zealand held fewer.
Richard Musty, of Lloyds Bank, explained this was probably due to UAE and Spanish expats moving temporarily, while those in the other countries tended to migrate for good.
“Despite having much more exposure to other markets and investments as expats, the confidence in British equities is good to see,” he said.
Expats hold British equities
“We think expats will continue to support British equities, especially as they seem to lack confidence in the almost once universally popular emerging markets.”
More than half of the expats taking part in the study had stocks, shares, bonds and other British assets in their holdings. Around one in four kept most of their portfolio UK-based, while one in 10 held at least 90% of their assets in British investments.
The bank suggests that expats think carefully before moving their money into markets they are unfamiliar about.
“Expats are generally moneywise because they come into contact with lots more opportunities than stay-at-home investors, but this can be confusing and not always a good thing,” said Musty.
“They need to research the market well before making any moves and work hard at keeping a well-diversified and balanced portfolio.”