Schroders Global Investor Study 2022: Majority of U.S. investors remain confident in the diversification of their portfolios, but rely on expert advice in unsettling times
New York, NY – December 7, 2022 – Schroders, a global asset manager, today released the findings of its annual Global Investor Study which surveyed over 23,000 investors (including 1,500 in the United States) and found that despite market headwinds, 63% of American investors believe their investments are diversified enough to mitigate against the impact of a significant market event.
However, despite U.S. investor confidence in their diversification, the study found they are inclined to turn to financial experts in these uncertain market conditions. Nearly half (48%) of U.S. investors who consider themselves as expert / advanced in their investment knowledge said they were more likely to speak with a financial advisor as interest rates rise. A similar percentage (46%) of U.S. investors found active funds more attractive than they were six months ago, acknowledging the added value of an active fund manager in challenging times.
Exercising caution in light of inflation
American investors were found to be optimistic yet cautious in response to a more challenging economic outlook, with the majority (55%) reporting that they changed their investment strategy in light of rising inflation, and 51% said they were more likely to save more and spend less.
Government bonds and cryptocurrencies were cited by 25% of U.S. respondents as being the least attractive asset classes, as appetite falls for assets that may be challenged by higher interest rates and recent negative headlines. Schroders’ recent research has indicated that private assets performance tends to be less impacted by economic cycles. Additionally, 49% of investors found sustainability and real estate more attractive than they were six months ago.
Adam Farstrup, Head of Multi-Asset, Americas at Schroders, said:
“These are unusual times with inflation in many countries now at its highest level for several decades. There is a danger that investors’ optimism about future returns is based on their experience of recent years, where inflation was in check and the cost of borrowing at record lows. We’re now moving into a new and arguably far more challenging phase.
“For some people, the phenomenon of rising rates and inflation is greatly disconcerting with the results of the Global Investor Study indicating that people of all types of investment experience are keen to seek the advice of experts to help them navigate these challenges.
“Indeed, it is times like these when the expertise and experience of active managers becomes increasingly crucial as investors look to control their investment risk and also diversify. Amid this challenging environment, the study also found that more than half of U.S. investors (58%) agree that the performance of their investments has a direct impact on their mental health, further emphasizing the critical role active managers and financial advisors have in supporting them.”
The full GIS report focused on investors’ response to rising inflation is accessible here.
Schroders plc
Founded in 1804, Schroders is one of Europe’s largest independent investment management firms by assets under management. As of 30 June 2022, assets under management were £773.4 billion (€898.4 billion; $939.2 billion). The founding family remain a core shareholder, holding approximately 48% of the firm’s voting shares. Schroders has continued to deliver strong financial results. It has a market capitalisation of circa £7.7 billion and employs over 5,800 people across 38 locations.
Schroders has benefited from the most diverse business model of any UK asset manager by geography, by asset class and by client type. Schroders offers innovative products and solutions across their five business areas of solutions; institutional; mutual funds; private assets & alternatives; and wealth management. Clients include insurance companies, pension schemes, sovereign wealth funds, endowments and foundations. They also manage assets for end clients as part of their relationships with distributors, financial advisers and online platforms. Schroders’ Wealth Management offering reflects their strategic ambition to provide wealth management and financial planning services to clients across the wealth spectrum.
Schroders’ strategic aims are to grow their asset management business, build closer relationships with end clients and expand their private assets and alternatives business. Schroders’ purpose is to provide excellent investment performance to clients through active management. The business channels capital into sustainable and durable businesses to accelerate positive change in the world. Schroders’ business philosophy is based on the belief that if we deliver for clients, we deliver for Shareholders and other stakeholders.
Important Information: All investments involve risk, including the loss of principal. The views and opinions contained herein are those of Schroder Investment Management North America Inc.’s (SIMNA Inc.). These views and opinions are subject to change. This communication is intended to be for information purposes only and it is not intended as promotional material in any respect. SIMNA Inc. is registered as an investment adviser with the US Securities and Exchange Commission and as a Portfolio Manager with the securities regulatory authorities in Alberta, British Columbia, Manitoba, Nova Scotia, Ontario, Quebec and Saskatchewan. It provides asset management products and services to clients in the United States and Canada. Schroder Fund Advisors LLC (SFA) markets certain investment vehicles for which SIMNA Inc. is an investment adviser. SFA is a wholly-owned subsidiary of SIMNA Inc. and is registered as a limited purpose broker dealer with the Financial Industry Regulatory Authority and as an Exempt Market Dealer with the securities regulatory authorities in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Quebec, and Saskatchewan. SIMNA Inc. and SFA are indirect, wholly-owned subsidiaries of Schroders plc, a UK public company with shares listed on the London Stock Exchange. Further information about Schroders can be found at www.schroders.com/us or www.schroders.com/ca. Schroder Investment Management North America Inc., 7 Bryant Park, New York, NY, 10018-3706, (212) 641-3800.
Contacts
Chaneigh Bernard, Prosek Partners
646.818.9274
Jennifer Manser, Schroders
212.632.2947
The views and opinions contained herein are those of Schroders' investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.'s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.