UK Investors Set To Alter Portfolios After Election Called – St James's Place

Amanda Cheesley Deputy Editor 21 June 2024

UK Investors Set To Alter Portfolios After Election Called – St James's Place

UK wealth manager St James's Place released a new survey this week, looking at how UK investors will make changes to their portfolios after the UK snap election was called for 4 July.

According to a survey by St James's Place, four in 10 UK investors were planning to adjust their portfolios after the UK election was called, with newer investors more likely to react.

It shows that novice investors – those who started investing in the last twelve months – are three times as likely to react in some way to this short-term event than more experienced investors who have been investing for over a decade.

Changes include adjusting asset allocation, withdrawing funds, making additional investments and diversifying across geographies, the poll reveals. It surveyed 1,000 UK investors between 5 and 11 June 2024.

Of those taking action, 25 per cent intend to increase exposure to equities, 22 per cent to bonds, while 24 per cent plan to diversify internationally by reducing their UK investments. By contrast, 13 per cent are considering increasing their investments in the UK market.

Nevertheless, the research reveals that those making changes are more likely to make additional contributions (33 per cent) rather than withdraw funds (15 per cent).

SJP’s analysis of UK market performance data spanning the past 10 UK elections also found that there were no clear trends between election outcomes and market performance, underscoring the importance of staying invested, not following the noise or trying to time the market in response to short-term events.  

“Our research into market behaviour shows that political events such as general elections have limited impact over the long-term. Therefore, while any period of political change can cause investors to worry, it is important not to become overly distracted by short-term noise,” Joe Wiggins, investment research director at St James’s Place, said.

“Successful long-term investing is founded upon building a diversified portfolio spread across asset classes and geographies and tailored to meet our return and risk objectives. If we get this right, we should be well-positioned to meet our goals irrespective of short-term events,” Wiggins added.

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