More than half of DIY investors pulled back from markets between February and the end of April 2025, new research from Charles Stanley Direct shows.
The sweeping tariff hike on US ‘Liberation Day’ scared 56% of self-directed investors away from the equity and fixed-income markets and into cash – proving Donald Trump’s trade policy was scarier than last year’s Autumn Budget, which only prompted 46% to sell up.
Younger investors were the most jittery, with 65% of both millennial and Gen Z bumping up their cash exposure, compared to 44% of Gen X and 31% of Baby Boomers. Other safe-haven assets were popular too, with nearly half (48%) of DIY investors turning to gold and 46% to property.
While cash is a safer option in uncertain times (as it avoids the price fluctuations typical of stocks and bonds), holding too much of it for too long could be a costly mistake, warned Rob Morgan, chief investment analyst at Charles Stanley Direct.
“While investors may have dashed for cash to find a temporary safe haven for their investments, it’s not generally something that holds as part of a long-term investment strategy,” he said.
“For an emergency fund and for any planned spending there is no alternative to cash. But those tempted to park large amounts of their long-term money in cash risk missing out.”
Investors who are thinking more tactically about the their cash allocation may also be ill-advised, if they believe they can quickly reinvest it into other areas at opportune moments.
“Market timing is notoriously hard and tends to require luck as well as judgement,” Morgan added.
In times of market volatility, investors are advised to keep calm and stick to their investing plans, focusing on the fact that sharp short-term moves “should pale into insignificance” over multiple years and decades.