E*TRADE Advisor Services Study Reveals advisors also note recession fears have increased among the client population
Advisors also note recession fears have increased among the client population
August 09, 2019 08:05 AM EDT — NEW YORK–(BUSINESS WIRE)–E*TRADE Advisor Services, a provider of integrated technology, custody, and practice management support for registered investment advisors (RIAs), today announced results from the most recent wave of its Independent Advisor Sentiment survey:
Recession fears take the lead.
The number one concern among clients, according to RIAs, is a recession (33%), up seven percentage points from last quarter and replacing volatility for the top spot.
Emotions loom large
Advisors said the biggest mistake clients make is trying to time the market (43%), consistent with last quarter’s findings.
While clients appear less concerned about volatility, advisors remain focused
Volatility is the number one risk that RIAs are actively managing in client portfolios, followed by interest rates (56%), and a flattening/inverted yield curve (43%).
Advisors are eyeing IT above all other sectors
Advisors noted that sectors with the most opportunity for their clients in the next few months are information technology (53%), health care (43%), and financials (34%), consistent with last quarter.
Focused On Fundamentals
“Advisors are focusing on the fundamentals of our economy, which are on relatively solid footing despite how late we are in the bull market run,” said Matt Wilson, head of E*TRADE Advisor Services. “Amid the recent market volatility, advisors can really demonstrate their value to clients—shoring up defenses in client portfolios, helping them understand the bigger picture, and encouraging them to stay focused on their long-term goals. Advisors play a critical role in helping clients navigate not only the immediate challenges the market can present but also what the market could bring in the months to come.”
When it comes to the market, what are your clients contacting you most about? | ||
Q3 2019 | Q2 2019 | |
Fears of a recession | 33% | 26% |
Market volatility | 24% | 47% |
China and US trade tensions | 22% | 11% |
Gridlock in Washington | 7% | 5% |
Economic weakness abroad | 3% | 0% |
Federal reserve monetary policy | 2% | 1% |
Flattening/inverted yield curve | 2% | 1% |
Other | 3% | 4% |
None of these | 4% | 5% |
What is the biggest mistake you see your clients making? | ||
Q3 2019 | Q2 2019 | |
Trying to time the market | 43% | 43% |
Not saving enough for retirement | 22% | 27% |
Prioritizing their dependent’s financial needs over their own | 14% | 11% |
Acting on stock tips that don’t align with long-term goals | 10% | 8% |
Asking for early withdraws from retirement accounts | 7% | 5% |
Other | 3% | 4% |
None | 1% | 2% |
What risks are you actively managing right now when it comes to client portfolios? Select all that apply. | ||
Q3 2019 | Q2 2019 | |
Market volatility | 68% | 75% |
Interest rates | 56% | 53% |
Flattening/inverted yield curve | 43% | 39% |
Recession | 40% | 41% |
Political instability | 34% | 33% |
Inflation | 22% | 30% |
Armed conflict, war, or terrorism | 5% | 7% |
None of these | 4% | 5% |
Other | 2% | 2% |
What industries do you think offer the most potential for your clients this quarter? (Please choose your top three) | ||
Q3 2019 | Q2 2019 | |
Information technology | 53% | 51% |
Health care | 43% | 34% |
Financials | 34% | 34% |
Consumer discretionary | 26% | 11% |
Consumer staples | 22% | 23% |
Energy | 21% | 26% |
Communication services | 12% | 8% |
Utilities | 10% | 8% |
Industrials | 9% | 12% |
Materials | 6% | 5% |
