Australian investors fret over Trump’s trade spats, but many hold firm

While Australian investors have overwhelmingly expressed their unease over the US’s trade policies and their impact on their investments, according to a new investor survey, a substantial number are staying the course with their asset mix.

The survey, conducted by ASX-listed investment platform InvestSMART, found the US’s trade policies weighing heavily on the minds of local investors, with nearly nine out of 10 (88%) respondents expressing their disquiet over Trump’s tariffs, with more than half stating they were “very concerned”.

Despite the outward concern over share market volatility, nearly half (47%) said they have, so far, had no desire to alter their investment strategies. Only around 10% said they would consider making changes if the volatility persisted.

Of the more than 50% that have changed their strategies in some way, many have taken advantage of the share market drop to increase their investments. A smaller proportion (around one-third of the changers) have taken the opposite tack, holding off on buying new investments.

Around 14% of the changers have sold investments to reduce risk, while 12% have shifted to more conservative assets such as cash and bonds.

Commenting on the results of the survey, InvestSMART chief executive Ron Hodge noted that investors are “clearly” conscious of the impacts of US tariffs on their investments.

Despite the concern expressed, he welcomed the significant number of investors avoiding “a knee-jerk response” to the US’s ‘reciprocal tariff’ regime – an attempt by the Trump Administration to balance bilateral trade deficits between the US and its trading partners through tariffs.

InvestSMART notes that nearly half (47%) of its surveyed investors describe themselves as ‘experienced’, which reflects their largely restrained response to tariff-induced market volatility.

While a number of countries and the EU have imposed retaliatory tariffs on the US, investors here appear to be less inclined towards such action, with around three-quarters of respondents stating that the Australian government should not adopt such an approach.

Overall, investors have mixed views on whether the Australian government should take further steps to protect Australia from the effects of global tariffs, with around one in three (33%) believing the local policymakers should avoid a response.

“While for many there are understandable question marks over what action Canberra should be taking, Australian investors are rightly mindful of any potential economic – and asset market – fallout resulting from introducing tariffs against the US.

Hodge concluded: “Right now, we are seeing a fast-evolving situation driven by the introduction of US tariffs. Australian investors are taking a measured approach, but their views should send a strong message to the Federal Government.”