Advisers most optimistic on Emerging Markets for 2010

Advisers are most optimistic on Emerging Markets for 2010 with UK shares in second place after a rollercoaster year for the FTSE-100, according to the latest results from the Virgin Money Investor Intentions Index.

Around 32% of IFAs are most optimistic about Emerging Markets despite the Dubai World debt shock in comparison with 30% who feel most optimistic about UK Shares, according to Virgin Money's research.

And the year-on-year figures show an even bigger turnaround - at the end of 2008 just 17% of advisers were optimistic about Emerging Markets compared with 50% who were optimistic about UK shares for the year ahead. Optimism about Far East Shares has also risen considerably from 12% a year ago to 22% now.

Virgin Money's authoritative Investor Intentions Index tracks the confidence of independent financial advisers across the country in 10 different investment sectors as well as where they advised their clients to invest their money over the preceding quarter.

IFAs are still advising clients to invest in UK Shares - the research shows 83% will advise clients to invest in the UK over the next three months compared with Bonds at 77% the next most popular sector ahead of Emerging Markets and European Shares at 75%.

Optimism about investing in Cash has fallen heavily from 19% a year ago to just 6% now. And just 58% of IFAs will be advising clients to put money into Cash over the next three months.

The switch away from UK Shares follows a turbulent year for the FTSE-100 which started in January at 4561.8 before dropping as low as 3512.1 in March and then rebounding to more than 5200 by the beginning of December.

Virgin Money spokesman Grant Bather said: "Optimism about Emerging Markets reflects the growing belief that economic recovery is underway worldwide while the UK has yet to officially emerge from recession. The MSCI Emerging Markets Index has doubled since March 2nd although it has suffered in the wake of the Dubai crisis.

"The bigger picture however is that confidence is returning to shares after a tough year and that advisers and their clients are now willing to take risks in return for long-term gain. Advisers and their clients are no longer fixated on safety at all costs and at a potential cost to themselves."