Over the 12 month period to September 2012, fixed interest holdings have slumped by almost 25 per cent to 10.6 per cent according to the quarterly Multiport SMSF Investment Patterns Survey.
"The five interest rate cuts in the last 12 months has reduced the attractiveness of fixed interest, which saw a sharp fall in allocation to this asset class in the quarter," AMP SMSF Administration head of technical services Philip LaGreca said.
"In the last 12 months, trustees are trying to get more bang for their buck by significantly increased use of short-term deposits."
Overall SMSF asset allocation to Australian equities also fell below expectations, only gaining 0.1 per cent to reach 31.8 per cent, despite the All Ordinaries being up 6.5 per cent in the same period.
"Despite strong performance in Australian equities for the quarter, it would seem that experience of prior volatility is making SMSF trustees cautious about further investments in this asset class," Mr LaGreca said.
However the results are in line with trends in previous years where the bulk of SMSF contributions were made during the June quarter.
This risk-adverse attitude is not just confined to local investors, with allocation to equities across the globe increasing just 0.1 per cent despite an increase of 5 per cent on the MSCI World Index over the same period.
Multiport said the strengthening of the Australia dollar over the quarter put a dampener on the offshore performance.
