One-in-five UK retail investors adjust portfolios in response to coronavirus, says GraniteShares

13/05/2020 - 9:21am
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Surveys & research

New research that reveals just over one in five UK retail investors (22 per cent) have made adjustments to their portfolios over the past eleven weeks, as stock markets around the world have fallen sharply due to the impact of coronavirus and then rallied as governments announced comprehensive measures to support businesses and the economy.

The findings, which are from ETF provider GraniteShares, reveal that 8 per cent have cashed in some of their investments, and 6 per cent say they sold some of them but bought new stocks.  However, 11 per cent say that they have invested more in the stock market as they think that longer-term, now is a good time to buy.
 
Indeed, 70 per cent of investors believe the fall this year in the FTSE 100 means it now represents a strong investment opportunity because many of the stocks are hugely undervalued. Some 21 per cent strongly agree with this view.

GraniteShares research found that a small number of retail investors (4 per cent) say they have made money from the stock market falling by shorting stocks. Overall, 78 per cent of retail investors say that over the past four weeks they have taken no action with their investment portfolios as the markets have fallen.
 
GraniteShares offers 11 FTSE 100 single stock 3x short ETPs and 11 FTSE 100 3x leveraged ETPs. Over the short week ahead of VE Day on 8 May, they delivered returns, inclusive of fees and other adjustments, of between +26.3 per cent and -24.6 per cent. The best performing GraniteShares ETP was 3x Long BP.  The second best performing long ETP was 3x Long Royal Dutch Shell, which delivered a return of +21.1 per cent, followed by 3x Long Glencore, with a return of +18.0 per cent.  The top performing inverse ETP was 3x Short Rolls-Royce, which delivered a return of +24.8 per cent.
 
Will Rhind, Founder and CEO at GraniteShares, says: “Since the Coronavirus crisis started, we have seen huge volatility in the FTSE 100 and other stock markets around the world. Our research shows that while some investors have responded by adjusting their portfolios, most are just sitting on their hands through this roller-coaster ride of volatility.
With advances in asset management and fintech, investors now have more tools to take control of their finances, and sophisticated investors can now more easily hedge against falls and boost returns from any recovery. This is exactly what our short and leveraged ETPs enable them to do.”
 
GraniteShares daily ETPs are providing long and short exposure to a selection of major companies listed on the London Stock Exchange.