ADVISOR | July 2021
In Italy, investors are only 25%. The remaining 75% prefers keeping money on bank accounts in case of need. There are two main reasons: poor financial knowledge and low level of trust towards the industry of asset management and financial consultancy.
This issue has been common knowledge for years but has only been partially solved.
There is another reason why only a minority of Italians invest their savings: the low appeal of investment funds from the point of view of marketing and brand awareness.
Italy counts about 5.400 open funds available to savers and an overall population of 60,3 million people. However, only 15 million of them can be considered potential end investors. On the other hand, the USA counts about 9.000 open funds and a population of 328 million people.
For this reason, in Italy mutual investment fund can easily become commodities. This means that, in the end, a product seems as good as any other.
Today, very few mutual funds have a distinctive identity and name which sets them apart in the vast sea of the offer.
Some of the most successful instances are Fidelity’s GMAI (Global Multi Asset Income); Pictet’s MAGO (Multi Asset Global Opportunities); and BlackRock’s FIGO (Fix Income Global Opportunities).
Indeed, their acronyms produced a high level of brand awareness for both financial advisors and private bankers.
With no distinctive names, Italian savers and their financial advisors cannot but focus on something familiar.
In this context, thematic funds represent a good option. Dealing with water, forests, infrastructures, smart cities, bridges, dams, vaccines, robots, oceans sounds much better than investing on a fund whose name is made of five or six English words, when in Italy only one person out of ten speaks English properly.
If it is true that a product owes its success to the performance it is able to generate, to the manager’s history and its track records, it is also true that an unknown product can hardly be successful in the market.
Furthermore, thematic funds offer the opportunity – for those who can take advantage of it – to build an effective storytelling.
In fact, in order to turn savers into investors, it is very important to give a name and a destination to their money.
Only then will the industry of asset management and financial consultancy have the chance to double its investors within a few years. Many AMCs are already achieving success. Good luck to the others.
Nicola Ronchetti