Fears that the U.S. economy will fall into a recession in 2023 have never been higher, with many high-net-worth investors believing a downturn is all but a certainty. A recent survey conducted by CNBC shows that this is the most bearish millionaire investors have been since the global financial crisis.
According to the survey, 56% of investors with at least $1 million of investible assets expect the S&P 500 to decline by 10% in 2023, while nearly a third expect declines of greater than 15%. And when asked about the biggest risk to their personal wealth over the next year, 28% said the stock market.
“This is the most pessimistic we’ve seen this group since the financial crisis in 2008 and 2009,” said George Walper, president of consulting and market research firm Spectrem Group, which conducted the survey with CNBC.
Amid serious pessimism over the future of markets, investors may want to consider the benefits of active management. While passive strategies lack the flexibility to adapt to changing market environments, active ETFs can offer the potential to outperform benchmarks and indexes. Plus, active managers with greater resources and greater scope benefit from economies of scale, which can often translate to better returns.
“Through active management, advisors can benefit from the ability of a team of analysts to separate which companies have the staying power to withstand the recessionary environment from those that are more likely to struggle,” said Todd Rosenbluth, head of research at VettaFi.
T. Rowe Price offers a suite of actively managed ETFs. T. Rowe Price has been in the investing business for over 80 years, conducting field research firsthand with companies, utilizing risk management, and employing a team of experienced portfolio managers carrying an average of 22 years of experience. The ETF issuer recently revealed that its actively managed funds have outperformed its passive peer funds 73% of the time over the last 20 years ended September 30.
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