Romanian investors have held firm during recent stock market declines
Retail investors around the world remain resilient despite stock market sell-offs and recession fears, with nine in ten holding onto their investments or buying the dip, according to the latest “Retail Investor Beat,” a quarterly survey of 10,000 retail investors in 14 country. by the social investment network eToro.
Globally, less than one in ten (8%) sold their investments during the recent stock market sell-offs, two-thirds (64%) maintained their positions and 28% bought the decline. Only 6% of Romanians sold their investments while 60% kept the investments and 34% bought the drop.
“Despite a barrage of setbacks in global financial markets, retail investors have found the strength to look beyond short-term volatility and use these price declines to bolster their long-term portfolios.” Ben Laidler, eToro’s global market strategist.
“For many retail investors, this is their first experience of a market pullback. Managing risk, controlling emotions and staying focused on long-term goals are things that even the most established investors have struggled with. Our latest retail investor survey shows retail investors are resilient, staying invested and building diversified portfolios to weather the storm With bull markets ultimately built on the shoulders of the markets bearish and nearly four times the duration and magnitude, staying the course should serve these investors well.
In light of recent market volatility, Romanian retail investors have repositioned their portfolios by increasing their exposure to cryptos (26%), cash (23%), commodities (19%), domestic stocks (16% ), foreign equities (16%), alternatives (14%), domestic bonds (14%), currencies (13%) and foreign bonds (10%).
Looking at sectors, 29% of Romanian investors increased their exposure to the energy sector, 24% bought technology and 23% financial services. Utilities (22%), Healthcare (17%), Real Estate (16%), Consumer Staples (18%), Telecommunications (15%), Materials (14%), Consumer Discretionary (12% ) and industries (10%) followed.
Globally, retail investor confidence in their investments has steadily declined in the five quarters since the inception of eToro’s Retail Investor Beat. Confidence fell from 83% in Q2 2021, 81% in Q3 2021, 80% in Q4 2021, 73% in Q1 2022 to 72% at the end of June this year. In Romania, investment confidence slowly fell from 87% in Q2 2021, 83% in Q3 2021, 85% in Q4 2021, 79% in Q1 2022 to 78% at the end of June this year
Rising inflation is back as the biggest risk also for 62% of Romanians surveyed, dethroning international conflict, which was the highest risk last quarter (57% in Q1). Nevertheless, international conflicts remain the second most important risk (45%), followed by developments in the global economy (43%) and the Romanian economy (32%). 16% of Romanians continue to believe that a change in taxation is a big risk for their portfolio, compared to 12% last quarter.
Despite these risks, 44% of Romanians (48% globally) plan to invest the same amount of money over the next 3 months, while 36% plan to invest more. 45% of Romanian investors believe that energy will still represent the best investment buying opportunity over the next three months, followed by technology (36%), utilities (31%), financial services (24 %) and real estate (23%). Globally, a third (32%) believe that energy, followed by technology (31%) and real estate (25%) will be the best buy in the next quarter.
“Energy and real estate are two of the world’s smallest sectors, they have always been good inflation hedges and remain at the top of retail investors’ buy and watch lists. What we saw in Romania , is that at all levels of experience, retail investors have increased their allocations to a series of defensive sectors, but still believe in the technology sector. strongly believe in their investment choices and are resilient in pursuing their investment plans,” Bogdan Maioreanu, eToro Market Analyst for Romania concludes.