Investor report

How are UK investors adapting to economic and political turbulence?

The success of any investor relies on their ability to navigate market trends, including political and economic uncertainty. This has been increasingly true in recent years, with significant market volatility presenting new challenges for investors

Economic headwinds have created a significant amount of volatility

Indeed, following the Covid-19 pandemic, most of the world’s major economies experienced a significant surge in inflation.

In the UK, for instance, the period between 2022 and 2024 was characterised by a crippling cost-of-living crisis that saw inflation soaring into double digits and persisting much longer than anticipated. Indeed, inflation hit a 41-year peak of 11.1% in October 2022, before finally subsiding to the Bank of England’s 2% target in May 2024’s Consumer Price Index (CPI) data.

As a result, policymakers and central banks were forced to intervene, choosing to embark on unprecedented interest rate hiking cycles to curb rising prices.

The Bank of England took the bank rate from a historic low of 0.1% in December 2021 to 5.25% in August 2023. Since then, the bank rate has been maintained at this level at seven consecutive Monetary Policy Committee (MPC) meetings.

Political turbulence has made portfolio management more challenging

Economics aside, there has been a great deal of political turbulence that has made it even more difficult for investors to manage their portfolios in the last eight years.

Despite the Conservative Party’s sustained parliamentary majority since 2015, the country has seen five different Prime Ministers in this time, and contentious issues such as Brexit, the management of the pandemic and the ongoing cost-of-living crisis continue to dominate proceedings in Westminster. A new Labour government marks the sixth occupant of No 10 in nine years, and one with a mandate for change.

Meanwhile, on the international stage, geopolitical tensions, including the conflicts in Ukraine and Gaza, have added further uncertainty and instability, requiring investors to carefully assess their strategies and the assets they are backing.

As the US gears up for an election this year, this political instability looks set to continue for some time. Therefore, it is important for investors to carefully consider their investments.

With this in mind, RAW Capital Partners is pleased to unveil its new investor research report.

RAW Capital Partners’ investor survey

In June 2024, independent research company Opinium conducted a survey of over 750 UK investors on behalf of RAW Capital Partners to understand their responses to the major political and economic challenges currently at play. At the time of the survey, all respondents had investment portfolios worth more than £25,000, not including their pensions, savings or properties that are used as their primary residence.

As well as shining a light on the way investors have been managing market volatility of late, the survey also identified which upcoming events are perceived as the greatest risks to investors and which asset classes are expected to garner the most attention in the coming year.

Gain exclusive access to our research insights

RAW Capital Partners has compiled all the data from this survey into an in-depth report, which provides an exclusive and detailed view of the state of play in the UK’s investment landscape. Shedding a light on how they feel they have navigated the last 12 months; the report also highlights their strategies and concerns for the year to come.

The full report, ‘How are UK investors navigating market volatility?’, is now available to download.

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As economic and political turbulence continues to characterise the world of investment, RAW Capital Partners remains committed to providing investors with insights into pertinent market trends and challenges.