Confidence in New Zealand’s financial markets has continued to rise in the last twelve months, following a significant
rebound in financial market performance, while more people are shifting from term deposits to shares.
For the first time, the FMA’s 2021 Investor Confidence survey
has found over 70% of investors are confident in the country’s financial markets, up from 66% in 2020.
The proportion of people with investments has remained relatively consistent at 84%. Although the broad types of
investments held by investors hasn’t shifted significantly over recent surveys, in the last three years, term deposits
have dwindled from 34% to 28%, while shares rose from 17% to 21%.
Rob Everett, FMA Chief Executive, said: “Term deposits have tended to be the most prevalent investment product outside
KiwiSaver, but in this low interest rate environment, with changing behaviours and preferences, individual shares are
closing the gap. This aligns closely with the rise of DIY, or fractional, digital share investing over the last few
years, with 60% of share investors now buying shares through these platforms.”
Mr Everett said: “It’s encouraging to see that investor confidence in the regulation of New Zealand’s financial markets
has remained steady at 67% and, almost two thirds of investors continue to acknowledge the usefulness of the investment
materials they receive. These are two key measures the FMA - and the industry - can always look to improve.”
“We also want to know how well consumers of financial services understand and acknowledge the actions we take as a
regulator can influence confidence in the markets and financial services more broadly. The scores show there is plenty
of work to do improve general understanding of these areas, since while few people disagree about our role in promoting
market integrity and fair, efficient and transparent markets, a very large portion did not express a view,” Mr Everett
More New Zealanders made new investments or increased existing investments in 2021 (23% in 2021 compared to 17% in
2020), however there was also a slight increase in those who decreased investments (9% compared to 6%), including
extending a mortgage. Of those who increased their investments, nearly half (43%) bought shares through an online