With the US presidential election drawing closer,nearly half of American retail investors are adjusting their portfolios. Arecent survey revealed that some of the investors are strengthening their cashreserves while others are targeting opportunities in equities and cryptoassets.

Investors Adapt Strategies

The survey by eToro showed that 49% of American retailinvestors have either already adjusted or plan to adjust their portfolios dueto the upcoming presidential election.

The study, which included responses from 1,000 USretail investors, showed that a significant portion of investors is increasingtheir cash holdings, with 42% of respondents favoring a more liquid position.Another 35% are buying more stocks, while 20% are venturing into crypto.

Interestingly, the study highlighted a generationaldivide in how investors are reacting to election-driven uncertainty. Youngerinvestors, particularly Gen Z (69%) and Millennials (68%) are the mostproactive in adjusting their portfolios.

Millennials are over twice as likely as their Boomercounterparts to have already made portfolio changes, with 32% of Millennialsshifting their investments compared to 14% of Boomers.

Commenting on the data, eToro Analyst Bret Kenwell mentioned:“There’s nothing wrong with investors adjusting their asset allocation ahead ofa big event, like the election. While younger investors are being a bit moreopportunistic, older investors are opting to be more passive, letting theirinvestment plans stay the course.”

Conversely, older generations are largely stickingwith their existing plans. More than half of Gen X (51%), Boomers (63%), andthe Silent Generation (60%) say they will not make adjustments before theelection.

While Millennials and Gen Z are increasingly buyingstocks, with almost half of Gen Z (49%) doing so, older investors, includingBoomers (43%) and the Silent Generation (47%), are focusing on increasing cashallocations.

Financial Services

Despite the looming election, the overall investmentsentiment remains positive toward certain sectors. Financial services continueto dominate as the top-held sector among retail investors, with 58% maintainingor increasing their exposure.

Technology (51%) and energy (41%) are also popular,though generational differences have become more apparent over time. Both Gen Z(68%) and the Silent Generation (55%) increased their tech ownershipsignificantly from the previous quarter, while other generations were morereserved.

This indicates a willingness among the youngest andoldest investors to buy into tech despite recent volatility. Among the topseven high-profile technology giants, retail investors are particularlyinterested in Amazon, with 26% planning to increase their holdings in thecompany.

In contrast, Tesla ranked as the least popular amongthese tech giants, with 36% of respondents indicating they do not plan toinvest in it, followed closely by Alphabet (35%) and Nvidia (34%).

This article was written by Jared Kirui at www.financemagnates.com.