Advisors see equities as top-performing, most volatile asset class for 2025
Volatility is good for business; advisors say it’s the “best time” to show value
DELRAY BEACH, Fla.–(BUSINESS WIRE)–According to the InspereX 2025 Advisor Pulse Outlook Survey of 829 financial advisors released today, more than two thirds (67%) of advisors said they expect the S&P 500 to be up 10% or more by year-end 2025 compared to where it was between May 12-19, 2025 (a low of 5786.08 and a high of 5968.61). More specifically:
- 60% expect the S&P 500 to be up 10%
- 6% expect the S&P 500 to be up 20%
- 1% expect the S&P 500 to be up more than 20%
- 25% expect the S&P 500 to be flat
- 8% expect the S&P 500 to finish down 10% or more
Nearly half (49%) of advisors believe equities will be the top performing asset class in 2025, followed at a distance by gold (14%) and cryptocurrencies (11%). When asked which asset classes will be the most volatile throughout the year, advisors identified equities (44%) and cryptocurrencies (36%) as the most likely to experience significant market turbulence.
Inflation Concern Cooling
According to advisors, they share the same top three concerns with investors – with one caveat: investors are more concerned about short-term market movements. Specifically, geopolitics (29%), market volatility (21%) and tariffs (18%) were identified as the top three concerns for financial advisors, while they said their clients were most concerned about market volatility (44%), tariffs (23%) and geopolitics (16%).
Notably, when the previous survey was conducted in November 2024, inflation was a top two concern for advisors and the leading concern for their clients. Today, inflation was selected as the fourth top concern for advisors (16%) and their clients (12%).
When asked to identify the biggest immediate fears clients are expressing, 42% of advisors said a market crash or loss of principal, 34% said political/economic uncertainty and 8% said running out of money in retirement. Only 8% said “none, they are mostly calm.”
Volatility: Boosting Business, Weighing on Sentiment
According to 69% of advisors, periods of market volatility are “the best time” to show value and strengthen client relationships. In terms of business growth, more than half (54%) of advisors said market volatility has led to increased client referrals or interest in professional advice from prospects.
With volatility on the rise, two thirds (66%) of advisors said their clients have become more risk-averse, while 27% said there has been no change in their risk tolerance. Only 7% said clients are becoming more risk tolerant.
Against this backdrop, 28% of advisors said their clients have needed to delay a major life goal, while another 52% have expressed concern about delaying.
Given this level of concern, 76% of advisors say they are discussing market volatility at least once per month with clients; and almost all the advisors surveyed (96%) say they are confidently able to tell clients: “You’re going to be okay.” This confidence may be reflected in their client portfolio allocations: 64% of advisors say they have not made significant changes to portfolio allocations over the last 6 months. In fact, the vast majority (88%) of advisors said their investment philosophy has been effective in protecting client assets through recent volatility.
Interestingly, volatility has also led to more contact with client family members: 20% said severe market volatility has led to more children of clients inquiring about how they are handling their parents’ investments.
“Advisors are optimistic about equity market returns in the second half of the year but understand recent severe volatility has rattled their clients. This is the ideal time for an advisor to demonstrate the enormous value they provide. Through asset allocation and smart planning, successful advisors are able to build portfolios that help their clients weather the storm and stay invested. And when they do, they see their business grow,” said Chris Mee, Managing Director of InspereX.
When asked whether they would consider letting go of a significant client who repeatedly disregards advice during a volatile period, 67% of advisors said they already have or would do so under the right circumstances.
Downside Protection Sees Upside Demand
More than one third (39%) of advisors say they currently use downside protection strategies, and the majority (55%) are increasing their use of such strategies, perhaps in reaction to client demand – 4 in 10 advisors said their clients are asking for downside protection strategies to cushion portfolios.
When asked how they are utilizing downside protection strategies:
- 33% of advisors said they’re using them to reduce or eliminate clients’ risk exposure
- 33% are using them to provide peace of mind to clients
- 19% are using them to improve their clients’ investment experience
- 15% are using them to target defined outcomes in client portfolios
Recent market events have led advisors to conduct new risk tolerance assessments, with 80% saying they are, or are planning to do so with their clients, while just 20% said they do not see a need to consider new risk assessments.
The top five protection strategies advisors are currently recommending to clients are:
- Annuities (69%)
- Structured products/market-linked notes (54%)
- Cash alternatives (50%)
- Buffered ETFs (42%)
- Market-linked CDs (33%)
“Downside protection strategies are keeping investors in the market during this period of heightened uncertainty. We expect demand for these strategies will be strong for the foreseeable future as sentiment remains uneasy,” Mee added.
About the Survey – View Survey Report
InspereX is the tech-driven fixed income and structured products distribution and trading firm. The InspereX Pulse 2025 Outlook Survey was conducted between May 12-19, 2025 by Red Zone Marketing on behalf of InspereX. The 829 financial advisor respondents work at independent broker/dealers, RIAs, banks, regional firms and wirehouses. During the survey period, the S&P 500 high was 5968.61, the low was 5786.08 and it closed at 5963.60 on May 19.
About InspereX
InspereX was founded in 1999 by Tom Ricketts, now our Chairman as well as the Executive Chairman of the Chicago Cubs. We pioneered delivering innovative, institutional-quality strategies and offerings to the retail market, and we’re now an industry leader in underwriting, marketing, and distributing a wide range of fixed income investments, structured products, and ETFs. Our ground-breaking investments, distribution, education, and technology have been recognized with dozens of awards. InspereX represents more than 400 issuing entities, distributes to more than 1,500 partners, and has distributed more than $800 billion in new issue securities. The firm has seven trading desks and more than 180 employees with offices in Delray Beach, Florida; Santa Monica, California; Charlotte, North Carolina; Chicago, IL; and New York, NY.
Contacts
MEDIA CONTACT:
John Principio
River Communications
914-686-5599
jprincipio@riverinc.com
