Investors searching for stronger returns post-Brexit are increasingly zooming in on the Far East, with Japan and China currently being the most attractive markets for UK investors. According to new data that City-based bank and brokerage firm Charles Schwab. Around 68% of investors in a recent survey consider Japan as a good investment destination. In comparison, the pan-European Stoxx 600 increased 18% during the same period, while the S&P 500 climbed just under 18% since October of last year. This shift to investing beyond Europe is borne out across the research. As British investors also view China as a significantly more attractive country for investment compared to a year ago. Charles Schwab found that China has seen the biggest rise in attractiveness, now appealing to 60% of investors, a jump of 15% since May 2020. Moreover, the U.S. has also become a more popular investment location. 67% of British investors consider it to be a more attractive market after November’s presidential election. As a result, nearly one in five investors said they had invested more in the U.S. over the last three months. Faced with sluggish recoveries in UK and European markets, British investors are going global, turning to Japan, China and the US for higher returns. More than half of UK investors, or 53%, are optimistic about the outlook for global markets in the next 18 months. This represents an eight percentage-point increase compared to May of last year, Charles Schwab found. In addition, almost half of investors have seen an increase in the value of their investments in the last three months. Again, this represents an improvement from May 2020 when just 29% had seen a rise in the value of their investments. Commentators believe we’re seeing British investors becoming more bullish as the performance of their portfolios improves. The combination of a strong bounce back in the Far East coupled with confidence in the Biden administration positions these markets as the Big Three outside of the UK for investors.

Past performance is not a reliable guide to the future. The value of investments and the income from them can go down as well as up. The value of tax reliefs depend upon individual circumstances and tax rules may change. The FCA does not regulate tax advice. This newsletter is provided strictly for general consideration only and is based on our understanding of law and HM Revenue & Customs practice as of April 2021 and the contents of the Finance Bill. No action must be taken or refrained from based on its contents alone. Accordingly, no responsibility can be assumed for any loss occasioned in connection with the content hereof and any such action or inaction. Professional advice is necessary for every case.