Markets may be hurting now, but investors think stocks will rally over the coming year, according to a new survey by asset manager Schroders.
The survey asked 507 investors with assets over $100,000 whether they predicted a positive annual rate of return over the next 12 months. Ninety-four percent said yes. In fact, 55 percent expected their investments to be up at least 5 percent—even though most say we're in a recession right now.
The respondents continue to like both international and domestic stocks and property even though the economy is weak. While about half of those surveyed owned bonds, just 21 percent said they're a good deal during a recession. In fact, most of the respondents are adding a variety of stocks and bonds to their portfolios even as the market weakens.
The biggest risk to future returns, says Alan Brown, chief investment officer at Schroders, is being overly cautious. While this downturn might be worse than most expected, favorable interest rates and expectations that inflation won't get out of control make it a good time for investors with long-term horizons.