One in three UK investors (33%) has seen the value of their portfolio fall during the pandemic, a study by Butterfield has found.

Research also indicated that three in 10 investors (29%) have “significantly altered” their investment strategies in response to COVID-19 – a figure which rises to 56% among investors with portfolios worth more than £1m. Butterfield found that another 47% changed their investment plans due to the UK’s record low interest rates.

The mortgage lender commissioned an independent survey of 1,479 UK-based investors, all of whom have investments worth in excess of £20,000, excluding their property, savings, and pensions. It found that 33% of investors saw the value of their portfolios decrease between March 2020 and September 2021.

The findings also revealed that 37% of UK investors have paused on making major investment decisions over the past 18 months due to the economic uncertainty caused by the pandemic. The same number (37%) said they were more risk-averse in their investment strategies in this period.

“Navigating the turbulent economic landscape during the pandemic has been a challenge for investors,” CEO of Butterfield’s UK-based mortgage operations, Alpa Bhakta, commented.

“The option for many has been to pause on making major investment decisions, or to adopt a more risk-averse financial strategy. Clearly, however, it has not stopped a significant number of investors from being hit financially by COVID-19.”

However, Butterfield’s study also indicated a rise in optimism among investors, with 44% believing their portfolios will perform well over the coming 12 months. This figure compares to just 20% who were not confident their portfolios will increase in value.

Bhakta added: “It is positive to note that the number of optimistic investors more than doubles those lacking confidence. With interest rates remaining at record lows and the UK government’s economic policies evolving all the time, it will be interesting to see how investors now adapt their strategies in the months to come and which assets or markets attract the most attention.”

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