Nearly all UK IFAs would never recommend cryptocurrency or meme stock investments
An overwhelming majority of IFAs would never consider recommending cryptocurrencies (93 per cent) or meme stocks (95 per cent) to their clients, according to insight from Opinium.
The research, conducted among 200 UK IFAs, finds a third (34 per cent) of IFAs have seen an increase in clients asking about cryptocurrencies this year, while 14 per cent have had more requests about meme stocks compared to last year.
However, nine in 10 (91 per cent) IFAs would be concerned if a client said they were investing in either cryptocurrencies or meme stocks. This concern is mirrored across those who advise clients of all portfolio sizes:
• 84 per cent of IFAs with clients with portfolios under GBP100,000 would be concerned if a client was investing in cryptocurrencies
• 90 per cent of IFAs with clients with portfolios between GBP101,000 to GBP200,000 would be concerned if a client was investing in cryptocurrencies
• 95 per cent of IFAs with clients with portfolios over GBP200,000 would be concerned if a client was investing in cryptocurrencies
On top of this, a third (34 per cent) are concerned that clients running their own investment in cryptocurrencies and meme stocks could be bad news for their own business, rising to 42 per cent amongst those whose clients have a small portfolio value (under GBP100,000).
Despite these doubts, a third (33 per cent) believe cryptocurrencies will become a legitimate investment vehicle in future, with 24 per cent thinking the same about meme stocks.
Alexa Nightingale, research director at Opinium, says: “With the recent crypto and meme stock frenzy, it’s no surprise that advisers are seeing an increasing interest in these vehicles from investors. There is clearly uncertainty and concern in the industry, and advisors with clients of all sizes would be wary if their clients were investing in these products. However, these sorts of investments are becoming more mainstream, so it will be interesting to see how advisers navigate this in future.”
The research was carried out across Opinium’s IFA omnibus, the UK’s only dedicated panel of IFAs.