Moonfare’s latest annual investor survey reveals significant changes in investment strategies as investors adapt to the evolving global economic landscape.
The survey, which garnered responses from 122 of Moonfare’s investors, aimed to understand the motivations behind portfolio construction among individual investors.
Despite an improved outlook on the global economy compared to last year, nearly half of the respondents (47%) still hold a negative view, while only 15% feel positive.
In response, investors are diversifying their portfolios by incorporating defensive strategies such as private credit, infrastructure and secondaries and traditional buyout funds. This shift indicates a growing focus on assets that offer protection amidst economic uncertainties.
The survey found 83% of respondents have stakes in buyouts, marking a 16% increase from 2022. Notably, co-investments are now present in nearly half (48%) of Moonfare investor portfolios, with private credit and infrastructure investments also rising.
Secondaries and private credit, known for potential discounts and diverse opportunities, are among the top three strategies favoured by investors in the current economic climate.
The survey also highlighted a significant move towards prioritising diversification, likely driven by ongoing economic uncertainty and the underwhelming performance of traditional asset allocation in the post-Covid era.
The survey also found that 46% of respondents reported a new focus on diversification, surpassing the 31% who have increased their cash reserves.
Despite the recovery of the traditional 60:40 portfolio this year, there remains concern that its returns may not keep pace with the expected prolonged period of higher interest rates. Consequently, most (over 88%) of investors plan to increase their allocation to private equity in the coming year.
Looking ahead, investors are optimistic about the technology and healthcare sectors, which are seen as well-positioned to capitalise on secular trends despite challenges like higher rates and labour costs. Healthcare is believed to hold the most investment potential by 78% of respondents, closely followed by technology at 76%.
However, the survey also reveals that only a small fraction (7%) of investors are ready to fully entrust their investments to AI-driven advice, though many are open to considering it in the future.
Moonfare founder and co-CEO Steffen Pauls, said, “It’s gratifying to see our investors positioning themselves for both current concerns and perceived longer-term opportunities. It shows they’re taking advantage of educational opportunities, some of which Moonfare provides, and building a more resilient portfolio for themselves and their families.”
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