Just 2% Seek Financial Advice Amid Market Volatility: Insights from Boring Money
As market volatility continues to shake the investment landscape, a recent report from Boring Money reveals a startling trend: only 2% of investors sought financial advice during these turbulent times. Let’s dive deeper into the findings of the Retail Distribution Report and explore the implications for investors and financial advisors alike.
The Investor Response to Market Turbulence
While the financial landscape is unpredictable, a significant majority of investors appear to be taking matters into their own hands. The report indicates that 58% of non-advised investors kept a close watch on their portfolios, and 45% went the extra mile by analyzing individual assets.
Founder of Boring Money, Holly Mackay, emphasizes the need for effective communication from financial providers during turbulent times. She notes that:
“Market turbulence needs good communication from providers. We saw 10% of our investor panel shift part of their portfolio into cash, and 9% made sales.”
Despite a higher number of purchases compared to sales, it’s evident that some investors acted prematurely, underscoring the crucial demand for clear, timely information when uncertainty reigns.
The Rise of Alternative Information Sources
Interestingly, as traditional financial advice appears to fall by the wayside, investors are increasingly flocking to platforms like Reddit and YouTube for guidance. Mackay notes:
“They wanted something more dynamic than what they were getting from providers.”
Key Priorities in Fund Selection
When it comes to choosing funds, risk and cost emerged as the top considerations for investors, closely followed by information regarding the fund manager. This shift towards a more informed decision-making process highlights the importance of transparency and accessibility in fund management.
Mackay added:
“The report highlights the role of platforms in investor communication. Most non-advised investors rely on investment platforms for information, particularly fund shortlists. Fund manager websites come a distant second.”
The Future of Investor Communication
As regulatory changes loom, Mackay urges fund groups to rethink not just what they communicate, but how they do it. An intriguing statistic reveals that investors under 35 are nearly five times more likely than those over 55 to seek investment information via social media.
Conclusion: Adapting to a New Landscape
The insights from the 2024 survey of 6,000 self-directed investors and 3,000 fund investors paint a compelling picture of a shifting investment culture. These findings resonate with the FCA’s latest Financial Lives survey published on May 16, which disclosed that only 8.6% of the UK population sought advice on investments, pensions, or retirement planning in the past year.
For both investors and financial advisors, the message is clear: in a world of volatility, the demand for fast, clear, and accessible information is more critical than ever. It’s time for the financial industry to adapt to these evolving needs and foster stronger relationships with investors.
For more insights on market behavior and investment strategies, check out trusted resources like Boring Money and Money Marketing.
