Investors in Australia remain cautiously optimistic on prospects for investment returns via the Australian share market but they also show little intention of allocating more cash from the sidelines into Australian or global equities.

The Australian Investors' Sentiment Survey for November, conducted by the Australian Investors' Association (AIA) and FNArena, shows the average cash held in Australian investment portfolios has stabilised around 19%. While this is down from a registered peak of 26% in September 2011, the number has hardly moved throughout the present calendar year during which (global) equities proved the best performing asset class.

In similar fashion, relative allocation to equities seems to have stabilised a fraction above 50% as Australian share market indices surged to new five year record highs during the month. A small retreat in overall optimism, both on an immediate and 6-12 months outlook, adds to the general picture that investors remain hesitant in allocating additional funds to equities.

Current relative portfolio allocations are close to levels that investors had indicated previously as "ideal allocations" to various asset classes. Allocations to property and fixed income remain little changed from their three-year average values of 18% and 14%, respectively.