- Only 8% of investors sold investments during recent stock market sell offs, 64% held firm and another 28% bought the dip
- Investors increased exposure to commodities (17%), crypto (16%), domestic equities (16%) and cash (15%)
- 48% plan to invest the same amount of money over the next three months and 30% expect to invest more
July 7, 2022: Retail investors around the world remain resilient despite stock market sell offs and recession fears, with nine in ten (92%) either holding onto investments or buying the dip, according to the latest ‘Retail Investor Beat’, a quarterly survey of 10,000 retail investors across 14 countries, from social investment network, TBanque.
Less than one in ten (8%) sold their investments during the recent stock market sell offs, two thirds (64%) held firm with their positions and another 28% bought the dip.
“Despite a barrage of setbacks across global financial markets, retail investors have found the strength to look past the short term volatility and use these drops in prices to bolster their portfolios for the long term,” comments Ben Laidler, TBanque’s Global Market Strategist.
“For many retail investors this is their first experience of a pull back in markets. Managing risk, mastering emotions and maintaining a focus on long term goals is something that even the most established investors struggle with. Our latest Retail Investor Beat shows that retail investors are resilient, they have stayed invested and are building diversified portfolios to weather the storm. With bull markets ultimately built on the shoulders of bear markets and near four times the length and magnitude, staying the course should serve these investors well.”
In light of recent market volatility, retail investors have repositioned their portfolios by increasing their exposure to commodities (17%), crypto (16%), domestic equities (16%), cash (15%), foreign equities (13%), alternatives (13%), domestic bonds (12%), foreign bonds ( 9%), and currencies (9%).
Looking at sectors, one in five retail investors (20%) increased their exposure to the energy sector, 19% bought technology, while real estate (16%), materials (15%), healthcare (14%), financial services (14%), staple consumer goods (14%), industrials (14%), utilities (13%), telecommunications (12%) and discretionary consumer goods (11%) followed.
Retail investors’ confidence in their investments has consistently declined over the five quarters since the inception of TBanque’s Retail Investor Beat. Confidence has fallen from 83% in Q2 2021, 81% in Q3 2021, 80% in Q4 2021, 73% in Q1 2022 to 72% at the end of June this year.
Rising inflation regained the top spot as the biggest concern over the next three months for retail investors (54%, up from 47% in Q1 2022) followed by international conflict (43%, down from 57% in Q1), the state of the global economy (steady at 37%) and rising interest rates (27%, up from 21% in Q1).
Despite these risks, almost half (48%) of respondents plan to invest the same amount of money over the next three months and 30% expect to invest more. A third (32%) believe energy will still present the best investment buying opportunity over the next three months, followed by technology (31%), real estate (25%), utilities (20%), healthcare (19%), financial services (17%), materials (17%), industrials (15%), staple consumer goods (14%), telecommunications (13%) and discretionary consumer goods (7%).
“While energy and real estate are two of the smallest global sectors, they have historically been good hedges against inflation and remain top of retail investors’ buy and watchlists. Across all levels of experience, retail investors have increased allocations to a series of defensive sectors and seem to have no intention of slowing down,” Ben Laidler concludes.
**ENDS**
Notes to editors
Survey research conducted by Appinio from 7 to 17 June 2022. Previous waves were conducted quarterly in conjunction with Opinium. In total, 10,000 retail investors sampled across 14 countries, 1,000 in each: UK, US, Germany, France, Australia and Spain. 500 in the following: Italy, Netherlands, Denmark, Norway, Sweden, Poland, Romania, and the Czech Republic. Retail investors were defined as self-directed or advised and had to hold at least one investment product including shares, bonds, funds, investment ISAs or equivalent. They did not need to be TBanque users.
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