RI investor confidence 3rd highest: Survey

JAKARTA. The level of confidence of Indonesian investors is the third-highest in the world, behind only India and Thailand, thanks to a positive economic outlook and a belief that investments will outperform savings.

These are among the highlights of the survey, the Schroders Global Investment Trends Report 2014, which involved 15,749 investors from 23 countries, including over 200 respondents from Indonesia. 

The survey, conducted in January 2014, focused on investors looking to invest at least ¤10,000 (US$ 13,755) in the next 12 months.

Schroders Indonesia CEO, Michael Tjoajadi, said that 76 percent of Indonesian investors exhibited confidence in the opportunities for investing this year. “The level of confidence among Indonesian investors is higher than the global average, at 56 percent, and the Asian region’s average of 66 percent,” he added.

“This also puts Indonesia on a par with Japan, both in third position after India, at 90 percent, and Thailand at 83 percent,” he further said.

The survey ranked Switzerland and the USA at the bottom, with confidence levels of 39 percent and 37 percent, respectively.

Michael said that although half of the respondents in Indonesia sought to invest between Rp 150 million ($13,094) and Rp 300 million this year, the investment-fund average had increased to Rp 636 million, or Rp 180 million higher than 2013.

“Approximately 20 percent of respondents plan to invest over Rp 1 billion,” he said.

Up to 76 percent of Indonesian respondents had annual household incomes of less than Rp 500 million, with 22 percent making over Rp 500 million. The main age bracket the respondents fell within was 25-34 years old (42 percent).

Michael said that a large proportion of respondents, 46 percent, preferred to invest their money in investment tools such as equities and bonds, with banking products the next favorite, at 26 percent.

“Investors see that they can make greater gains through investment tools like equities compared to bank interest,” he said.

The survey also showed that 51 percent of respondents chose to invest in equities, with 55 percent opting for gold. Respondents were allowed to choose more than one investment product.

“The most popular equity products are Indonesian-based equities, with 30 percent of respondents opting for these,” he said.

Globally, Asia Pacific has emerged as the prime investment region for all investors. Thirty-nine percent of global investors said that they saw potential in the region, with 63 percent of Indonesians believing in the potential of the region.

Michael added that all investors sought to put their money in emerging markets given that these markets had the potential for good growth. The improving global economy, driven by ameliorations in the economies of the US and Europe, has also sparked investor appetite.

“As for Indonesians, the main investment criteria are stability, flexibility and capital growth,” he said.

He said the upcoming elections were not a point of concern to investors. “In fact, 46 percent of investors expressed concern about high inflation, followed by 28 percent saying their concern was high taxes,” he said, adding that 54 percent of investors here focused on investing for retirement.