Nuno Matos, HSBC’s CEO of wealth and personal banking, told CNN Business that global investors were “not being as active as they used to be,” with many looking to sell off what they see as riskier bets and “buying more protection for their portfolios.”
“We see customers sitting a little bit in the sidelines,” Matos said in an interview on Monday, adding that many had turned to bonds as they search for some “stability.”
“There is one common element that all of them are very concerned [about],” he added.
Stocks are suffering as a consequence. Global markets are down more than 20% so far this year.
Matos told CNN Business how Europe’s biggest bank was advising its customers, which include both high-net-worth and retail investors, to play defense.
He also suggested investors explore “value” stocks versus “growth” stocks, essentially prioritizing big companies with stable market share and healthy payouts for shareholders over other fast-growing businesses.
Even as many people sell assets, “you want to keep invested,” said Matos, noting the adverse effects of retaining cash during a high inflation period.
He anticipates the current holding pattern among investors to last until the middle of next year, when markets have a better grasp of how interest rates will stabilize and get “some breathing space.”