Wealthy investors want to buy or hold stocks in the midst of a decline, the study said.

The trader is working on the floor of the New York Stock Exchange (NYSE) in New York City, USA on May 3, 2022.

Brendan MacDermid | Reuters

Wealthy investors are more likely to hold more stock or shift out of a particular sector than to sell if stocks continue to decline, according to a new study.

According to a UBS Investor Sentiment survey, more than one in four US millionaire investors surveyed, or 26%, said they would increase their investment if the financial markets fell further. Only 19% said they would reduce their investment, and 25% said they would not make any changes.

According to a survey of 900 investors and 500 business owners with at least $ 1 million in investable assets, 30% of investors say they will shift the sector if the market falls. When asked how likely they were to invest in a particular asset class, a maximum of 37% said stocks. They also plan to increase their investment in commodities, with 32% in favor of gold and 31% in favor of oil.

Jeff Scott, Head of Client Insights at UBS Global Wealth Management, said: “That doesn’t mean they won’t make tactical changes, but they aren’t sold out because the market is down. We encourage people to make a financial plan and stick to it.”

Indeed, investor surveys were conducted between April 5th and April 18th, before the most recent market decline. Still, wealthy investors do not seem to be loading more cash. The average holdings of cash and cash equivalents actually fell slightly to 19% of investable assets, compared to 20% of investor sentiment in February.

Those who have a lot of cash are worried about the effects of inflation. According to the survey, two-thirds of those who hold more than 10% of their assets in cash are “extremely concerned about the impact of inflation on the real value of cash.”

The majority of investors cite inflation as a major investment concern right behind political and geopolitical risks. A majority of 51% also said volatility was higher than usual, with S & P down 13% and Nasdaq down 21% this year.

While market volatility and concerns about rate hikes and inflation are drawing attention, Scott says wealthy investors have some reassurance to recede concerns about Covid-19. Said.

“The pandemic isn’t over, but there seems to be a bigger sense of being back to normal,” he said. He said, “at least in the United States, it offsets some of the growing concerns about Russia, Ukraine and inflation.”

Wealthy investors want to buy or hold stocks in the midst of a decline, the study said.

Source link Wealthy investors want to buy or hold stocks in the midst of a decline, the study said.

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