As well as investing in what might be considered to be fairly conventional financial products, it is also notable that in Australia there has been significant direct participation by retail investors in the markets for sophisticated financial products. For example, retail and high net worth investors account for about two-thirds of the assets of Australian-based hedge funds, compared with less than half globally.
The available evidence for Australia also suggests a larger retail presence in the market for collateralised debt obligations than is the case in other markets. Over the past five years, retail investors are estimated to have purchased around 15 per cent of the CDOs issued in Australia.