Wealth managers and institutional investors are planning to increase their focus on yield in their portfolios over the next two years in anticipation of a stock market correction, research from CrossLedger Capital has shown.

Its study of global wealth managers, asset managers, family offices, hedge funds, and institutional investors found that 96 per cent planned to increasingly look to yield-focused strategies, with 83 per cent doing so as they expected a stock market correction.

Nearly half (49 per cent) of respondents said they had locked in recent gains, while 43 per cent cited volatility as a reason.

More than six in 10 (61 per cent) had 25 per cent or more of their portfolio already focused on delivering yield, and 13 per cent had between 50 per cent and 75 per cent of their portfolio in yield-focused strategies.

CrossLedger Capital said the hunt for yield over the next two years would drive interest in digital assets, with 89 per cent of respondents saying they were open to exploring new asset classes to deliver yield.

The asset classes wealth managers were most likely to be planning increased allocations to were investment grade corporate debt, money market funds, digital assets, and dividend paying equities.

Commenting on the findings, Brava CEO and founder, Graham Cooke, said: “Concerns about a stock market correction are building and that is reflected in the growing interest in yield-focused strategies and potential changes in institutional portfolios over the next two years.

“Digital assets capable of delivering yields are firmly in the mix for institutional investors looking for yield-focused strategies given the recent performance of the asset class and the potential yields funds can deliver.”

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