Investors still rushing for term deposits
Investors continue to pull their money out of the stockmarket at record rates and ploughing their savings into term deposits.
Australian term deposits have swelled by $276 billion since July 2007, growing at an annualised rate of 22.3 per cent.
The local equity market, which was worth $1.4 trillion in mid-2007, lost about $243 billion over the same period. It is now worth about $1.157 trillion. Charlie Aitken, managing director at Bell Potter Securities, said there has been an “almighty switch” from equities to term deposits.
At the peak of the market in July 2007, the term deposit market was worth $207 billion. That figure has since grown to $438 billion. Meanwhile, the return on the local equity market declined by 4.4 per cent a year over the same period.
Source: Sydney Morning Herald