2024 Global Retail Investor Outlook 2025

From investment to divestment, each decision has an impact on overall portfolio performance and presents an opportunity to design products and education interventions customized to investor segment and goals Page 47 Selection phasePage 47 Portfolio management Divestment phase Individuals are often drawn to products they’re familiar with, especially stocks that are popular in the media or among peers (e.g. NVIDIA, Tesla). 84% of investors are invested in local markets, while only 44% invest internationally.Retail portfolios can have higher market risk exposure due to diversification approaches (e.g. equal split across assets, holding one asset class or stock). Among investors who hold mutual funds or ETFs, 36% allocate less than a third of their portfolios to these assets. In contrast, 59% of cryptocurrency asset holders invest more than a third of their portfolios in crypto.Frequent portfolio adjustments and excessive trading can contribute to lower returns due to higher fees, taxes and possible poor timing of market moves. 22% of investor respondents review and adjust their portfolios at least every week (more than 50% at least once a month). Retail investors tend to over-rely on past performance when choosing financial products for their portfolios. Approximately 60% of investors consider past performance as a key benchmark when investing in mutual funds.42Retail investors can hold excessive savings in cash throughout their investing life cycle, potentially limiting returns while increasing exposure to capital erosion. £430 billion excess savings in cash among UK citizens, with 13 million adults missing out on investing returns.44Investors tend to sell winning positions too quickly while holding on to losing ones for too long, often following market trends with expectations they will continue. 49% of respondents see the “ability to stay calm and rational in market fluctuations” as key to successful investing. Unclear investment fees and assumed trust in advisers and products can reduce individuals’ overall investment returns. An approximately 50 basis point standard deviation in fees was registered among nearly identical S&P 500 index funds offered by different asset managers.43Newer investors tend to consider dividends as risk-free gains, which may in turn encourage biased asset-allocation preferences. Approximately 39% of retail investors plan to turn their portfolios into disposable income by choosing dividend-paying stocks.Overwhelming information and social influence can lead retail investors towards investments that may not align with their long-term investment goals or risk-return profiles. 37% of mass market investors do not feel confident about their ability to understand financial content (vs. 13% high net worth+).Potential under-performance drivers 2024 Global Retail Investor Outlook 46