Financial technology company SoFi (SOFI 0.59%) He recently conducted a survey of 1,000 investors (excluding SoFi members) to find out how they feel about the stock market now as we go through a dismal 2022 and into 2023.
One of the most interesting results is that 85% of investors say they plan to make at least one major change to their portfolio or investment style in 2023. This is not too surprising, considering that only a quarter of the Investors will not be disappointed. their investments in 2022.
5 big changes that US investors will face in 2023
As mentioned, the majority of investors plan to make at least one major change to their strategies in 2023. Only 15% plan to continue investing in the same way as in 2022. Here are the five most answers popular
1. Invest more in the market
The most common change that investors are planning for 2023 is to invest more money in the market. While the declines in 2022 were scary at times, it seems that the market (for now, at least) has seen its low point, and many investors may be eager to add to their portfolios while the stocks remain beaten. After all, the S&P 500 it is still about 18% below where it started 2022, and many stocks are 30%, 50%, or even more below their peaks.
2. Do more of your own investment research
The second most common change is that investors want to take a more active role in researching the investments they buy. And that certainly makes sense. After all, many of the investors who were hit the hardest in the downturns of 2022 are those who simply followed the crowd into high-momentum stocks and cryptocurrencies without knowing too much about what they were buying.
If you are in this group and want to learn how to do an investment research the right way, here is a great first that I wrote that can help you get started.
3. Work with a financial advisor
Not everyone should be a completely independent investor, especially if you don’t have the time and desire to learn about things like asset allocation, risk management and the many investment options. available to you. A key tip is to make sure the financial advisor or financial planner you choose has a fiduciary duty – all Certified Financial Planners® do, but not everyone who uses the titles of financial advisor or planner is held to this standard. A fiduciary is required to put your interests on their own, especially when it comes to things like investment fees.
4. Buy a new type of investment
Maybe this means buying stocks instead of cryptocurrencies, or funds exchanged instead of individual actions. Maybe some stock market investors want to branch out to own real estate or another form of tangible asset. Diversification is certainly a great tool when used properly, and buying new types of investments can be a great way to achieve it.
5. Plan to change your asset allocations
This is a little in the previous change, buying new types of investments. Asset allocation refers to how much of its investable assets are allocated to different investment classes (stocks, bonds, cash, real estate, etc.). Many investors who have started in recent years have been in 100% stocks or have an overweight allocation to things like cryptocurrencies. Creating an age-appropriate responsible asset allocation is certainly a worthy goal.
Change can be good
As a final thought, it is encouraging that not only do most investors want to make changes after the stock market crash of 2022, but most of the main changes are in the direction of being more responsible, more informed, or just. better investors. In addition, 93% of survey respondents said they continued to invest, despite market conditions, indicating a long-term mindset is very common. All good investors must be able to adapt their investment strategies over time, and it seems that many investors do just that.