Swiss investors are lagging behind their European counterparts in embracing investment technology services. A new survey by Swiss banking technology provider Avaloq, which polled 1,430 investors across 10 countries in Europe and Asia, found that only 8% of Swiss respondents are investing via robo-advisory platforms, and 6% via crowdfunding platforms.
This is behind Germany, France and the UK, where 17%, 10% and 14% of investors, respectively, use robo-advisors. Adoption levels are also higher for crowdfunding platforms, with 23% of respondents in Germany, 24% in France and 14% in the UK stating that they use these platforms to invest.
Across all 10 markets, Asian investors were found to be the most open to investment tech, with 52% of respondents in China, 36% in Hong Kong, 23% in Singapore and 21% in India claiming that they use robo-advisors. Likewise, usage of crowdfunding platforms is also higher in these markets, with Hong Kong taking the lead (42%), followed by India (40%) and China (25%).
These findings indicate some reluctancy from Swiss investors when it comes to robo-advisors despite these services being much cheaper than traditional financial advisors and planners, which 18% of Swiss respondents indicated relying on.
A recent research conducted by Swiss online comparison service Moneyland.ch found that traditional banks can be more than twice as expensive as online asset managers and robo-advisors.
Examining the costs of Swiss wealth management in 2021, Moneyland.ch found that on average, traditional asset management clients pay around 1.37% per year for a portfolio of shares worth CHF 1 million, compared to an average of 0.62% per year for digital providers for a similar portfolio, with Findependent and True Wealth emerging as the cheapest services.
Investment trends and preferences
Looking at investment trends, the Avaloq study found that investors in a number of markets, including Switzerland, the UK and Japan, are investing to have enough money for retirement.
After retirement income (69%), Swiss investors named property investments (33%), future personal health care costs (32%) and funding their own entrepreneurial activities (25%) as the primary reasons why they invest.
Although the range of assets investors invest in varies from one country to another, a few are emerging as favorites, with publicly-traded stocks/equity, cash and investments funds often cited amongst a market’s top three preferred assets.
On cryptocurrencies, sentiment differs greatly from one market to another. Indians and Germans are the most open to the emerging asset class with 49% and 45% of respondents in these respective markets investing in cryptocurrencies. At the other end of the spectrum is Japan where only 11% of respondents indicated investing in cryptocurrencies. Swiss investors stands somewhat in the middle, with 25% of respondents investing in cryptocurrencies.
2021 has been the tipping point for the acceptance of cryptocurrencies and digital assets in Switzerland. A research by Zug-based investment company CV VC found that, this year, investors are entering the space at a rapid pace and that a number of large Swiss institutions are currently preparing for a digital asset offering out of public view, indicating that client demand has simply become too large to brush aside.