conventional wisdom says investors shouldn<u+2019>t make decisions on short-term events like the u.s. presidential election. investors, however, see little that<u+2019>s conventional about this election<u+2014>and they<u+2019>re telling their advisers all about it. while financial advisers generally agree that it<u+2019>s unwise for investors to try to time the market, some clients aren<u+2019>t heeding their message. the level of concern is unprecedented, says marianela collado, a senior financial adviser with tobias financial advisors in plantation. fla. <u+201c>prior to this, politics and presidential elections rarely came up,<u+201d> ms. collado says. but this year, the election is being raised in every client meeting. <u+201c>from a market perspective, it should not be different, but psychologically, it<u+2019>s a little nerve-racking for a lot of our clients.<u+201d> nearly two-thirds of americans say the presidential election has had an impact on their investment decisions over the past year, a new survey from blackrock inc. found. the survey examined the investing attitudes and behaviors of 1,633 americans, including 1,440 investors, with a focus on how the election is shaping their views of the investing environment. three-quarters of the those surveyed indicated that they believe the election will have a greater impact on their personal finances than the 2008 election, the last time there was no incumbent president on the ballot, and about one-third indicated they feel the election poses a threat to their financial future. what<u+2019>s behind investors<u+2019> consternation? russ koesterich, managing director and member of blackrock<u+2019>s global allocation team, points to the backdrop of rising populist sentiment in the u.s. and globally as well as anti-trade and anti-immigrant sentiments. <u+201c>this is creating a lot of angst for a lot of investors,<u+201d> he says. <u+201c>what we hear anecdotally is that you do have a fair amount of cash on the sidelines from both advisers and self-directed investors.<u+201d> <u+2018> <u+2018>some clients don<u+2019>t like either [candidate], and they<u+2019>re really worried that either one is going to cause too much uncertainty in the economy.<u+2019> <u+2019> ms. collado has clients who fear a hillary clinton presidency and those who worry about the unknowns of a politically untested donald trump in the white house. her message to both camps is the same: in the long run, markets are priced based on information that<u+2019>s already available, and there<u+2019>s no need to start making moves based on who<u+2019>s going to win the presidency. there will probably be some volatility around election day, she says, but that will offer an opportunity to do some tax planning and portfolio rebalancing. nevertheless, for a few particularly worried clients, ms. collado has sold some stocks and shifted the money into cash and fixed-income investments. <u+201c>for some<u+2014>so that they can sleep at night<u+2014>we<u+2019>ve changed their asset allocation a bit,<u+201d> she says. <u+201c>we<u+2019>re not going to ignore the fact that they<u+2019>re feeling uncomfortable.<u+201d> still, while it<u+2019>s a natural reflex for investors to want to sell investments when their anxiety rises, nothing has occurred that should cause long-term investors to alter their plans, mr. koesterich says. <u+201c>it may not be justified, but it<u+2019>s an understandable reaction,<u+201d> he says. financial planner jonathan harrison says clients are bringing up the election more this year than ever before. <u+201c>one day it will be trump. one day it will be clinton,<u+201d> says mr. harrison, a planner with sound stewardship llc in kansas city, mo. <u+201c>some clients don<u+2019>t like either [candidate], and they<u+2019>re really worried that either one is going to cause too much uncertainty in the economy.<u+201d> <u+201c>some of the extreme emotion has filtered down to even the most sophisticated investors,<u+201d> he says. one high-net-worth investor chose to donate stocks now to a donor-advised fund rather than wait until next year. mr. harrison said the client indicated that he<u+2019>d be very upset if he waited and the stocks declined in value in january. and some retired clients are rebalancing early to obtain cash for their coming living expenses to make sure it<u+2019>s done before the election, he says. the presidential election also is a topic of concern for almost every client who meets with rick kahler, president of kahler financial group in rapid city, s.d. clients in his state are most concerned with a win by mrs. clinton, while east coast clients are more concerned with a victory by mr. trump, he says. but there<u+2019>s more concern about the house and the senate going to the democrats, mr. kahler says, in which case some fear that the u.s. will go to a single-payer health-care system and that more regulations will be enacted that could hurt the economy. some clients have said they want to move to cash, but so far mr. kahler says he<u+2019>s been able to keep them in the market. <u+201c>i don<u+2019>t know if they listen to us a little better having gone through 2008 and having seen what happened with brexit,<u+201d> he says, referring to the financial crisis and the u.k.<u+2019>s decision this past june to exit from the european union. mr. kahler is stressing to clients that his firm<u+2019>s moderate portfolios have 60% in stocks and 40% in bonds, with just 15% of the overall assets in the u.s. the firm<u+2019>s bond portfolios have an average duration of 3.5 to 3.6 years, he says. he<u+2019>s also emphasizing that the president doesn<u+2019>t run the economy any more than he (or she) runs congress or the supreme court. still, a few of his clients who have received lump sums of cash aren<u+2019>t ready to invest it yet, he says. in september, mr. kahler laid out for one couple the reasons that it was ok to invest. <u+201c>we<u+2019>ll think about that,<u+201d> he says they told him. but when he asked when he should call them again, he said they replied: <u+201c>after the election.<u+201d> write to daisy maxey at daisy.maxey@wsj.com
for advisers, election has stirred client concerns - wsj
daisy maxey