Capital.com survey suggests retail investors are “perhaps expecting markets to bounce back”
“the moment the majority of investors still seem to be taking the view that the set back in stock markets for the year so far is just temporary and a pause before the bull market returns.”
A survey conducted by global trading and investment platform Capital.com found that 62% of its users think that inflation and geopolitical risks will be the two most influential events to impact financial markets in 2022.
Despite these top concerns among retail investors, only 21% of traders thought that interest rate hikes would be a key event for financial markets this year.
The survey had the participation of 4267 traders registered with Capital.com and was carried out between 21 February and 31 March 2022.
30% are bullish, 28% are bearish
The survey suggests that retail investors are perhaps expecting markets to bounce back. 42% of respondents said they had a neutral view on the stock market for 2022, while 30% held a more bullish outlook. The remaining 28% were bearish on the stock market.
David Jones, Chief Market Strategist at Capital.com, said: “At the moment the majority of investors still seem to be taking the view that the set back in stock markets for the year so far is just temporary and a pause before the bull market returns. Let’s not forget – investors and traders have been very well rewarded for more than a decade for just buying the dip and assuming higher prices are just around the corner. Of course back then we didn’t have the threat of further rate rises and stubborn inflation – so the question is if this time it will be somewhat different.”
“42% of respondents having a neutral expectation of the market is testament to the amount of volatility we have seen in just the first months of 2022 – and how that has come as a shock to many investors who have enjoyed years of bull markets”, he continued.
“The slowdown this year is the direct consequence of geopolitical tensions, inflation and interest rate rises. Although Tech IPOs saw a significant decline compared to last year, Tech is still the most followed sector for public listings by our clients, closely followed by Energy, which instead represented the most active sector for IPOs since the beginning of the year. We have seen a number of IPOs either not perform as well as expected, or get pulled with a view to trying to list in the future. So for investors it is something of a waiting game to see if the volatility in markets abates and we return to more normal conditions,” he added.
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