Over a third (38%) of retail investors in the UK have said they plan to diversify their investment strategy over the next 12 months as they look to manage their concerns over the health of the UK economy, Shojin has found.

The investment platform commissioned an independent survey among 2,000 UK adults, of which 964 had investment portfolios worth in excess of £10,000.

The research found that two thirds (65%) of UK retail investors have adapted their investment strategies to rising interest rates and high inflation over the past 12 months.

However, economic fears remain, with over half (55%) of respondents worrying that the UK economy entering a recession would negatively impact their investments.

Alongside the 38% of retail investors that said they would diversify their investment strategy, 53% said they plan to keep their investment strategy largely the same as it has been throughout 2023.

The study also found that 57% of UK retail investors will prioritise investments that offer set returns within an agreed period, with two-thirds planning on increasing the amount of money they have saved in ISAs.

Chief executive officer at Shojin, Jatin Ondhia, said: "Our research shows that while UK investors are navigating the complex financial landscape with adaptability and resilience, concerns still linger about the state of the national economy. Understandably, many are likely to take a low-risk approach over the next 12 months. Meanwhile, it's positive to see a growing number of investors taking proactive steps and beginning to diversify their portfolios.

"Each investor must assess their appetite and ability to manage risk. As part of this calculation, they ought to consider diversification, which can act as a shield against market volatility and offer a hedge against uncertainties.

"As we move forward, there is a sense of cautious optimism – most (57%) UK investors think the worst of the economic turbulence from the past 18 months has now passed. Clearly, the government needs to rebuild trust in the state of the economy. But investors must remain in control of their decisions; they have to ensure they’re making choices that align with their risk tolerance and long-term goals. It will be fascinating to see how the investment landscape continues to involve in the months to come."

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