WAYNE, Pa.--(BUSINESS WIRE)--New data released today by Hartford Funds reveals that advisors believe anxiety negatively impacted investor decision making over the last 12 months. The survey of more than 200 advisors also shows that despite political uncertainty both domestically and globally, advisors’ clients still have appetite to invest new dollars.
“Investors and advisors witnessed significant geopolitical events in the last year, all of which can impact decision-making,” said John Diehl, senior vice president of Strategic Markets for Hartford Funds. “Our survey clearly demonstrates that helping clients better understand their risk tolerance and how anxiety can lead to poor investment decisions is more important now than ever before.”
ANXIETY IMPACTS INVESTOR DECISION MAKING, POLITICS TOP OF MIND
Most advisors (62 percent) agree client anxiety led to poor investment decisions last year. Measuring current concerns, politics top the list of reasons advisors believe are currently keeping clients awake at night. Domestic politics are causing more sleepless nights for clients (37 percent) than international politics (14 percent), according to advisors. Meanwhile, advisors were more likely to say they are sleeping soundly (31 percent) than being kept awake by domestic (20 percent) or international politics (21 percent).
“Advisors typically see less reason for concern in times of political disruption because they are able to tune out the noise; they understand that there’s less of a connection between politics and market cycles,” continued Diehl. “Sharing data to this effect and discussing your clients’ risk tolerance can help ease their minds, as well.”
Comparing confidence levels in international and domestic stock markets, advisors preference is evenly split at 39 percent. Meanwhile, 22 percent are equally confident in both markets or undecided. With a shifting domestic and international political landscape, financial advisors are not putting all of their eggs in either basket.
CLIENTS READY TO INVEST MORE, BUT ADVISORS CAUTIOUSLY OPTIMISTIC
Despite political concerns, advisors said that most clients (80 percent) want to take advantage of the current environment by investing more dollars. However, half of advisors recommend clients maintain risk levels and one-third recommend lowering portfolio risk. Conversely, 17 percent are advising clients to take on more risk, consistent with 68 percent of investors who have appetite to invest new dollars at this point in time.
The survey of 218 financial advisors was administered in-person in April 2017.
About Hartford Funds
Founded in 1996, Hartford Funds is a leading asset manager, which provides mutual funds, ETFs, and 529 college savings plans. Using its human-centric investing approach, Hartford Funds creates strategies and tools designed to address the needs and wants of investors. Leveraging partnerships with leading experts, Hartford Funds delivers insight into the latest demographic trends and investor behavior.
The firm’s line-up includes more than 60 mutual funds in a variety of styles and asset classes, and 9 ETFs. Its mutual funds (with the exception of certain fund of funds) are sub-advised by Wellington Management or Schroder Investment Management North America Inc. The 7 strategic beta ETFs offered by Hartford Funds are designed to help address investors’ evolving needs by leveraging a unique risk-optimized approach, which identifies risks within each asset class and then deliberately and systematically re-allocates capital toward risks more likely to enhance return potential. Hartford Funds has mutual fund assets under management of $87.1 billion as of March 31, 2017 (excluding assets used in certain annuity products). For more information about our investment family, visit www.hartfordfunds.com.
All investments are subject to risk, including the possible loss of principal. There is no guarantee the funds will achieve their stated objectives.
Investors should carefully consider a fund’s investment objectives, risks, charges and expenses. This and other important information is contained in the fund’s prospectus and summary prospectus (if available), which can be obtained by visiting hartfordfunds.com. Please read it carefully before investing.
Hartford Funds refers to Hartford Funds Management Group, Inc., and its subsidiaries, including the mutual funds’ and active ETFs’ investment manager, Hartford Funds Management Company, LLC (“HFMC”) and the mutual funds’ distributor, Hartford Funds Distributors, LLC, as well as Lattice Strategies LLC (“Lattice”), a wholly owned subsidiary of HFMC effective July 29, 2016. Lattice is the investment adviser to the strategic beta ETFs. All ETFs are distributed by ALPS Distributors, Inc., which is not affiliated with Lattice or Hartford Funds. “The Hartford” is The Hartford Financial Services Group Inc. and its subsidiaries. Hartford Funds Distributors, LLC is a subsidiary of The Hartford Financial Services Group Inc.
Some of the statements in this release may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. We caution investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Investors should consider the important risks and uncertainties that may cause actual results to differ. These important risks and uncertainties include those discussed in The Hartford’s Quarterly Reports on Form 10-Q, our 2016 Annual Report on Form 10-K and the other filings The Hartford makes with the Securities and Exchange Commission. We assume no obligation to update this release, which speaks as of the date issued.
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