Investors turn to the stock market for better ISA returns

Investors are feeling positive about investing in the stock market during 2010, with many believing it will produce more lucrative returns than cash, according to research from retail stockbroker The Share Centre.

The survey of 845 private investors showed that 44% are unhappy with the interest rates offered on cash ISAs and that they believe the stock market will prove more profitable than cash investments in 2010.

A further 20% said they plan to invest in both cash and stocks during this year. Only 1/10 said they plan to stick to cash only investments, and a mere 3% said they could not afford to invest in the stock market at this point in time.

When asked how they felt about the stock market since September 2009, an incredible 75% said it had provided good opportunities for those that knew what they were doing, and that it had been a good time to pick up bargain stocks.

Positivity towards investing in the stock market continued, as 40% predict the FTSE 100 will close between 5,500 and 6,500 at the end of 2010.

With the end of the 2009/10 tax year just around the corner, Nick Raynor, investment adviser at The Share Centre, is advising investors to make the most of their ISA.

"Record levels of government spending and borrowing as a result of the financial crisis, means that over time higher personal taxation is inevitable. As such, it is imperative that investors make the most of the tax breaks available to them. One of the most accessible is an ISA," said Raynor.

Raynor adds: "With just over a week left to top up a 2009/10 ISA, investors should act fast or they risk losing their allowance for ever. Customers of The Share Centre can add to their ISA online right up to 12 noon on 5 April 2010. However, those wanting to top up in the traditional way will have to get their instructions to us before the close of play Thursday 1 April."