More than half of the investors that participated in Mandatum Trader’s survey intend to increase their holdings in securities within the next six months, even though the economic outlook remains weak. Investors identified fading economic growth, inflation and geopolitics to be the most critical risks today.
The investor survey carried out by the Trader securities trading service in October 2022 looked into the behaviour and insights of Finnish investors. According to the survey, the uncertain market situation has not increased investors’ willingness to sell. Of the respondents, 51 per cent said they would increase their investments over the next six months, and only six per cent said the were planning to reduce their security holdings over the same time span. The more active investors in particular said they intended to increase their investments: 67 per cent of them have plans to increase their security holdings.
“Regardless of the uncertain market situation, investors’ willingness to sell has not increased to any significant extent, and it is no surprise that especially the active investors are keen to buy. Based on Trader’s own customer data, the investment behaviour of the more active investors also suggests that they are shifting the focus of their portfolios to derivatives,” says Niklas Odenwall, VP of Trading and Execution Services at Mandatum.
Based on the responses, both those who view themselves as aggressive investors and those who consider themselves to be more conservative believe that the threat of economic growth fading is the greatest risk they face when investing in securities. The top three risks also included inflation and the increase in geopolitical tensions. The responses revealed that both those who intended to increase their investments and those who were planning to reduce them rated the same threats as the most significant.
“Although both groups saw the same threats, they reacted to them in different ways. Some investors see opportunities even within the threats, whereas others only see the threats,” Odenwall says.
For most respondents, the current investments were focussed on equities and funds and they were planning to increase the same asset classes. The greatest investment potential was seen in the health sector, energy sector and information technology. Under a third of the respondents were considering investing in an investment property.
The main rationale for increasing investments in all groups was long-term investing. Other reasons behind investors’ plans to increase investments depended on their risk taking profile. Experienced investors, clearly more often than others, seek better returns at higher risk, whereas those who have been investors for a shorter amount of time show a slightly higher tendency to hedge against inflation.
“Although the economic situation seems gloomy at the moment, it is not a good idea for investors to rush into abandoning their investment plan, if their finances can sustain it. A good approach for long-term investors is to continue investing regularly as usual, whilst being mindful of the diversification of their investments. Investors who have been focussing on Finnish investments only might find that now is a good time to expand their horizons,” Odenwall says.
The survey also looked into how important sustainability is for the respondents. Almost half of all respondents (47 per cent) and 40 per cent of the return-driven respondents considered sustainability to be a very important or important criterion when selecting an investment. In responsible investment, the achievement of a positive social impact was particularly important for the respondents.
More information about the survey:
Mandatum’s survey was carried out by Innolink. The survey respondents consisted of 1,002 Finnish investors aged 18+ who sell or buy shares, funds or other securities at least once a year. Data collection was carried out in a consumer panel in October 2022.
Niklas Odenwall, Vice President, Trading and Execution Services
niklas.odenwall@mandatumlife.fi, tel. +358 40 565 6043
Niina Riihelä, Senior Vice President, Marketing and Communications
niina.riihela@mandatumlife.fi, tel. +358 40 728 1548