Investing in shares overtakes cash in the popularity stakes says Fool.co.uk

31 March 2009 / by Rebecca Sargent
Shares have overtaken cash when it comes to investing, new research from Fool.co.uk has revealed.

According to the '£50,000 Windfall' survey, when quizzed over where they would invest a £50,000 windfall received today, more than a quarter (26 per cent) said they would invest it in shares.

In comparison, just 12 per cent said they would hold onto the money in cash, meaning that 88 per cent of people questioned would not consider keeping the windfall in cash.

The survey also found that, despite 12 consecutive months of tumbling house prices, one third of potential investors would choose property for their investment.

A further 15 per cent claim that investing in gold is best, while 17 per cent would choose to put the cash into bonds.

Commenting, David Kuo, director at The Motley Fool, said: "Cash is no longer king in the eyes of investors. It has been relegated to the status of pauper.

"In fact, holding onto cash could even be a liability if the Government accelerates quantitative easing. History tells us that increasing the supply of money can be inflationary.

"One of the best ways of ensuring our money holds its value is to invest in assets that can beat inflation. Traditionally, these have been shares and property."

Meanwhile, Scottish Widows Investment Partnership (SWIP) has increased the equity weighting of its fund as it expects a boom in the equity market. Mark Harries, head of multi-manager at SWIP, said:

"We anticipate a significant upturn in the equity market. We are not predicting a return to a bull market but we are of the opinion that there will be a sharp rally. We want our customers to benefit from that rally and so have increased our exposure to equities."

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