It hasn't been the easiest of years for ASX share investors so far.
With the majority of ASX shares struggling as they're faced with rising inflation and higher interest rates for the first time in a decade, the All Ordinaries Index (ASX: XAO) has fallen 14% in 2022.
Despite the market turmoil, Aussie retail investors remain upbeat, with many looking to buy the dips.
That's according to social investment network eToro's latest Retail Investor Beat. The quarterly report surveys 10,000 retail investors across 14 countries, including 1,000 in Australia.
Here's how the Aussie investors responded.
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75% of ASX share investors confident with their investments
Despite the majority of ASX shares sliding over the past quarter, 58% of Australian retail investors said they're 'quite confident' with their investments with another 17% saying they're 'very confident'.
Which is not to say they don't have concerns.
The top concern among Aussie respondents is rising inflation, with 52% citing that as a chief worry. Also high on the list is the state of the global economy, named by 43% of retail investors. Atop those, 42% were concerned about international conflict, while rising interest rates were alarming to 38% of respondents.
Yet few ASX share investors opted to sell during the past quarter's selloffs.
Of those surveyed, only 7% of retail investors chose to sell, while 68% held onto their investments, and 25% went bargain hunting, buying the dips when prices retraced.
In terms of how Australian retail investors repositioned their portfolios, 20% favoured cash, 17% named domestic equities, 16% said commodities, and 14% went for crypto.
Breaking that into sectors, the survey revealed that ASX share investors increased their allocations to energy by 17%, technology by 17%, utilities by 15%, healthcare by 15%, and financial services by 14%.
Eyeing the next bull market
Commenting on the survey results, eToro's global market strategist Ben Laidler said:
Despite a barrage of setbacks across global financial markets, retail investors in Australia and around the globe have found the strength to look past the short-term volatility and use these drops in prices to bolster their portfolios for the long-term.
With bull markets ultimately built on the shoulders of bear markets and near four times the length and magnitude, staying the course and repositioning their portfolios should serve these investors well.
eToro's Australian market analyst Josh Gilbert pointed out the importance of time in the markets for ASX share investor strategies.
According to Gilbert:
The reality is that investment strategies depend on an investor's risk profile and timeline. Most retail investors are Millennials and Gen Z that have a much longer time horizon. Therefore, they are generally happier to buy these assets at the current discounts with the view of holding for many years until markets eventually recover.
