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May 14, 2019 at 12:54 PM
Three in five ETF investors expect market volatility to increase in the next six months, and more than two in five say they will put more money into ETFs as a result, according to a study released Friday by Charles Schwab & Co.
“After a decade of market gains, ETF investors now see clouds on the horizon and are planning to use ETFs to help them weather the storm,” Kari Droller, vice president of third-party mutual fund and ETF platforms at Schwab, said in a statement.
“It’s clear that ETFs serve a unique role for investors, as the foundation of a portfolio and also as a vehicle that enables them to be nimble.”
Logica Research conducted the ninth installment of Schwab’s annual ETF investor study from Feb. 20 to March 4 among 1,500 individual investors 25 to 75 with at least $25,000 in investable assets who had bought or sold ETFs in the past two years.
Sixty-three percent of study participants said they planned to invest in domestic equity ETFs over the next year. For sector ETFs, technology was the top choice for 69% of all respondents and 74% of millennials. Half of respondents chose financial services, and 45% real estate.
Some three-quarters of those surveyed said now was a good time to invest in fixed income ETFs.
Because of increased market volatility, 51% of respondents said they had increased their allocations to ETFs in the past six months. Seventy-three percent of these said they expected to increase their ETF investments over the next year, and 37% said they would consider placing their entire investment portfolio, excluding cash, into ETFs in the next year.
