And the lack of knowledge, in turn prevents them from recommending products.
The survey has also revealed that the knowledge gap persists despite a fifth of the 200 survey respondents believing their clients to be interested in learning about Islamic funds.
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Further, the study which was conducted by CoreData and commissioned by BLME to explore advisor attitudes to non-traditional investments has found that just 7% of those surveyed said that they are familiar with Islamic investments.
Additionally, it has been also found that advisers are unsure of how to classify Islamic investment products, with 40% stating that they were not sure whether such products were alternative or not.
And almost 60% of the advisers who recommend alternatives put forward ethical investments, which BLME claimed share many characteristics with Islamic investments.
Nigel Denison, head of asset management at BLME, remarked, "The results of this research reaffirm our belief that Islamic funds have been largely overlooked to date. Advisers appear to have retreated into the products they are most familiar with in response to the market tumult of recent years."
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By GlobalData"This highlights the importance of Islamic fund providers helping to educate investors, particularly as in this case a significant number of respondents said clients would be interested in learning more," Denison added.
