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There has been a strong surge in confidence among wealthy New Zealand investors during the third quarter, according to the latest ING Investor Dashboard Survey.
It is the first time since the survey began two years ago that Kiwi investors are feeling optimistic, with sentiment rising by 41 points to 125 out of a possible 200.
ING says out of all the Asia Pacific markets surveyed, New Zealand rebounded the most.
ING investment manager Stuart Millar says the upswing comes as domestic equity markets and earnings data improve.
The survey showed that 34% of Kiwi investors saw in increase in investment returns in the third quarter compared with 11% in the last quarter.
Seventy-one percent of Kiwi investors felt that economic conditions improved during the quarter compared with 25% in the second quarter, and 72% believe conditions will continue to improve in the next quarter.
However, Millar says New Zealand is still playing a bit of catch up.
"In the second quarter we saw that New Zealand investor sentiment was still pessimistic and adopting a bit of a cautious approach to some of the first signs that the global economic recovery may be under way, whereas in other parts of Asia they had responded quite quickly to initial stimulus from the government there and some of those early signs," he says.
Across the Tasman, investor sentiment picked up by 27 points in the third quarter to 143, while Asia inched up from 132 to 143.
Overall, investor sentiment improved in 10 of the 13 surveyed markets with declines seen in Japan and India, and a flat result for Thailand.
Millar says economic momentum could continue for some time yet, and alongside that, Kiwi investor optimism has room to improve.
"The risk is that once expectations do get a little bit too high then the room for disappointment does increase," he says.
Millar believes unemployment is the biggest threat to investment as a downturn in jobs would lead to a lowered investement appetite.
