Registered investment advisors expect to see increased usage of exchange-traded funds in client portfolios, despite aversion to risk remaining high, according to a new study from Invesco.

RIAs surveyed by the asset manager believe ETFs will comprise 24 per cent of portfolio allocations over the next year and 33 per cent over the next three years, which the firm says represents a 10 per cent increase compared to results reported in its 2011 survey.

"Against a lingering backdrop of global economic uncertainty, RIAs still see clients remaining vigilant in their aversion to risk as 91 per cent believe their clients are more interested in minimizing losses than maximizing gains," the firm said.

The recent findings illustrate how RIAs are embracing the value of ETFs and the many ways they can be implemented in their clients' portfolios, Bobby Brooks, national sales director at Invesco PowerShares added. "But even as the equity markets have enjoyed a strong run year-to-date, RIAs are still indicating that risk management is a primary focus and they are looking to a variety of products, including alternative assets, to manage risk."

Other key findings include:

- RIAs continue to blend active and passive funds in a single portfolio: 40 per cent of RIAs agree that "now more than ever" they are creating client portfolios using a blend of active investment vehicles and passive ETFs, while less than a quarter use an exclusively all-active management portfolio (24 per cent) or an all-ETF/passive management portfolio (19 per cent).

- Risk management remains a priority: As was the case with the 2011 survey, RIAs regard managing risk as the predominant philosophy in managing client assets (40 per cent). Meanwhile, wealth preservation was the most important issue for clients, followed by mitigating risk.

- Risk management investment strategies have not changed: RIAs still create a blended asset allocation of active investments and passively managed ETFs (62 per cent) and apply a more conservative asset allocation (56 per cent) to mitigate risk in client portfolios.

- Alternatives and emerging market equities and large-cap funds are drawing more attention: Within actively-managed mutual funds, RIAs are most likely to increase capital over the next year in alternatives (46 per cent), emerging market equities (43 per cent) and US large-cap funds (40 per cent).

The study was conducted for Invesco by Cogent Research in late August and early September, based on RIAs with an average of $478 million in investable client assets.