Financial advisors consider ongoing volatility one of the top macro issues that will adversely affect client portfolios over the next 12 months, according to Jefferson National’s second annual Advisory Authority survey.
The survey was conducted by Harris Poll online in the U.S. in March among the 683 financial advisors, 440 of whom were independent registered investment advisors and 243 broker-dealers, and 733 investors, ranging from mass affluent to ultra-high net worth.
Seventy-six percent of RIAs and fee-based advisors, and 89% of the highest earning ones, and 63% of investors in the survey expected volatility to rise in the coming year, agreeing that it would be exacerbated by both U.S. politics and domestic and international economics.
Britain’s Brexit vote continued to roil global markets on Monday.
Both groups were also closely aligned on the main causes of volatility:
- Energy prices: advisors 34%, investors 33%
- Federal Reserve policy: advisors 32%, investors 23%
- U.S. presidential election: advisors 30%, investors 36%
- Instability in China’s market: advisors 21%, investors 25%
Sixty-two percent of all RIAs and fee-based advisors said they felt pressure to revise their investing strategy in the current volatile market.
Protecting assets stood out as their priority, as 69% said they would invest somewhat or much more conservatively to address volatility, and just 14% said they would invest more aggressively.
Three-fourths said they would invest somewhat or much more tactically, while only one in 10 said they would invest more passively to address volatility.