Our Weekly Newsletter
Across Instinctif Partners’ Financial Services team, we are always keeping an eye on the key developments taking place across the sector to evaluate their impact on the many businesses we work with. Here we share our picks of the week’s most interesting news, and our expert views.
Banking taking a toll on employees’ mental health
The Banking Standards Board has released the 2019 report stating 25% of surveyed bank employees revealed that work has had a negative impact on their overall wellbeing. Unfortunately, this percentage does not come as a shock considering similar percentages from previous years. The survey asked questions regarding the amount of sleep employees receive each night to which an overwhelming 37% responded they routinely received less than 6 hours each night. In recent years many banks have taken action to help reduce negative impacts on mental health yet as the Board acknowledges, these actions and plans do not change the culture overnight. (From Financial News, 28 January 2020).
Big investors prune their hedge fund exposure
Big investors have started to reduce the amount of money they hold in hedge funds due to a decade of underperformance by hedge funds and the rising popularity of Index tracker funds. Managers have underperformed the S&P 500 stock index every year since 2009, both in rising and falling markets. Factor in that we are currently in the longest bull run in history and it is small wonder that large institutional investors are turning to relatively inexpensive passive funds. However, were market conditions to turn more volatile, many heads of investments have signalled they would look to hedge funds once again. (From Financial Times, 28 January 2020)
House price growth across UK cities has hit a two year high of 3.9%, bolstered by a surge in buyer demand, according to the latest research from Zoopla. Buyer demand in the first weeks of 2020 was 26% higher than the same four-week period in 2019 and 2018. With the exception of Belfast, every UK City recorded an increase in demand from buyers over this time. Cities in the North of England have recorded the strongest interest from buyers this year, with interest in Sheffield up 20% on the national average. Meanwhile in the South, cities such as Southampton, Oxford and London, have underperformed. (From Financial Reporter, 29 January 2020)
Climate Policies to be public to pension holders in March
Following the UK Government’s commitment to be net zero by 2050, the department of Work and Pensions has announced a new objective aimed at informing pension holders of their investments’ policy on climate change. Guy Opperman, the pensions and financial inclusion minister, confirmed a March release for all investment documents containing climate policy. This announcement comes after recent research stating that most pension holders want to be more informed about where their assets are being invested. Mr. Opperman hopes that increased awareness of climate policy will help occupational pension holders be more informed about how their funds are being invested. (From FT Adviser, 28 January 2020).
Robo-advisers trending among Millennials
Research from law firm Michelmores LLP shows a growing trend in the use of robo-advisors among affluent millennials as opposed to in-person services. Over half of the millennials surveyed revealed that they prefer advice from online automated financial services, indicative of the increasing trust in technology among the age group. While robo-advisors are on the rise, some millennials have opted for a hybrid approach to financial advice, looking to both in-person and robo-advisors for their wealth management needs. The research is good news for the growing robo-advising sector however it has struggled to be profitable. (From Financial Planning Today, 29 January 2020).