Investor cash obsession worries wealth creators

  

Yes the wealth creators are feeling the pinch. Got a letter from an Industry Super Fund extolling the virtues of diversification. The result for 1 and 5 years was clearly in favour of Diversified Fixed Interest but we all know that past performance is not indicative of future returns. It seems investors have discovered the motto " A bird in the hand is worth two in the bush " or did they get offended at being called Muppets ? Hmm I wonder...

  It may need some serious changes to way share markets operate before ordinary investors are willing to move more of their retirement savings from capital guaranteed products into equities. Ordinary investors can be forgiven for thinking that they are swimming with sharks if they invest in markets that are infected with short sellers, with high speed traders, with institutions that disguise their trading by dealing though dark pools.

All institutions, except those engaged in these confidence eroding practices, have an interest in returning the market to its basic and important economic function of supporting capital formation and making a market for willing buyers and willing sellers.