Before President Donald Trump announced his tariffs, 55 percent of investors felt they were informed about the risk to their portfolios, according to a recent State Street Global Advisors study.
The annual study explores the evolving role of exchange traded funds (ETFs) in portfolio construction, risk perceptions, and investor behavior and examines how investors manage risk, navigate uncertainty, and adapt to macroeconomic and market shifts.
“As the market absorbs tariff impacts and ongoing uncertainty, questions around risk, diversification, and access to liquid, flexible investment tools are front and center,” Anna Paglia, State Street Global Advisors chief business officer, said. “Our research addresses key questions about portfolio resilience.”
The study also found:
Tariffs and trade wars were perceived as the greatest risk to portfolios in the coming 12-18 months.
ETFs are seen as essential portfolio building blocks during times of volatility, especially among those with more than $250,000 in investable assets.
Nearly half of investors are managing risk by taking the traditional approach of “avoiding high-risk investments” and/or “diversification” while more than a third are also managing risk by “holding cash or cash equivalents.”
Financial advisors are helping clients navigate perceived threats through the use of alternatives investment strategies and holding cash.