Most investors globally are contemplating changes to their portfolios ahead of the US election, according to the new Investor Sentiment study by UBS, the world’s leading global wealth manager.
According to the study, which polled more than 4,000 investors and business owners across 14 markets globally in late September and early October, 72% of investors are considering a shift in their holdings prior to the vote. Sixty-two percent are planning to make additional changes based on the result.
- Sixty-six percent of investors are considering allocations to the healthcare sector over the next six months, while 62% are considering 5G networks and 56% are considering investments in a green recovery.
- Fifty-five percent consider their home region to be an attractive investment, the most popular choice globally.
- Forty-nine percent say they want to capture more yield in the next six months, compared with just 29% who want to reduce the level of risk in their portfolio.
- Seventy-five percent say they want more contact with their advisor.
More specifically in the United Arab Emirates87% of investors are considering adjustments to their portfolios prior to the US election and 78% plan to make further changes based on the result.
- Sixty eight percent are optimistic about their region’s stocks on a short-term basis (over the next six months)
- Investors prioritize yield in their portfolios with 61% aiming to get more yield in the next six months and 30% looking to reduce the level of risk in their portfolio.
- Eighty three percent consider the UAE as an attractive region for investment opportunities followed by the US (68%) and Europe (68%).
Tom Naratil, President of UBS Americas and Co-President of UBS Global Wealth Management, says: “We recognized early in the pandemic that our clients needed advice more than ever, and the ongoing market volatility and political uncertainty reinforced that need. This survey reiterates that investors are looking for advice, and the US election is a unique opportunity for wealth managers to reach out to their clients and provide them with guidance during an uncertain time.”
Iqbal Khan, Co-President of UBS Global Wealth Management, says: “Amid uncertainty over the US election and COVID-19, investors appear to be more positive on their own region than on the world at large. In the period surrounding the election, we believe they should diversify globally and avoid falling prey to their own home bias.”
Ali Janoudi, Head of Middle East and Africa at UBS Global Wealth Management, says: “The US elections are a global event with repercussions across the globe, including in the Middle East. UAE investors are watching closely and the vast majority consider portfolio changes both ahead and after the elections, depending on results. Clearly there is strong demand for investment advice.”
US
US investors’ optimism over their region’s short-term economic and market outlook has increased by the second biggest margin globally. Fifty percent are optimistic on the economy, up from 41% three months prior, and 55% are optimistic on stocks, up from 44%. Forty-nine percent of investors globally consider the US an attractive investment, the highest across any one region.
Latin America
Latin American investors are the most likely to express a positive short-term outlook, with 62% optimistic on their own region’s economy and 60% optimistic on their own region’s stocks. Eighty-one percent are considering making portfolio changes in anticipation of the US election and 73% plan to make additional changes based on the result, the highest proportions globally.
Europe
European respondents outside Switzerland are expressing above-average optimism on their own region’s economy over the next 12 months. Fifty-eight percent say they are optimistic versus 55% globally. Compared with their international peers, European investors are more likely to be planning to adjust their portfolios after the US elections, with 65% saying they will do so.
Switzerland
In the short term, Swiss investors’ optimism on their own region’s economy and stocks has increased by the highest margin globally. Forty-four percent are expressing optimism on their region’s economy over the next 12 months, up from 32% three months prior, and 54% are expressing optimism on their region’s stocks over the next six months, up from 42%.
Asia
Fifty-five percent of Asian investors are expressing optimism on the economic outlook in their own region over the next 12 months, in line with the global average. They are also more likely to adjust their portfolios around the US election. Eighty percent are considering doing so before the vote and 65% are planning to do so afterwards.