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Recent goings confirm global geopolitical tensions continue running hot and the domestic political climate is far from sanguine – both of which indicate the investing environment is far from sanguine.
Experienced market participants know the possibility of headline risk never goes away and when it flares up, that’s not necessarily a reason for investors to flee to cash or other low-risk assets. However, turbulent times accentuate the value of working with advisors and the potential benefits offered by active management.
In turbulent times, whatever the cause of said volatility may be, advisors are invaluable to clients because they can calm nerves while helping clients realize that risk, particularly of the political variety, is fleeting and can be endured when the right plan is in place.
Regarding active management, which is experiencing a renaissance of sorts, it’s increasingly relevant to clients because they want protection and more than just index-matching returns when markets falter against the backdrop of global or domestic unrest.
Active Management, Advisors Increasingly Relevant
A recent survey by Natixis Investment Managers confirms that clients are increasingly seeing value in active management – an interesting phenomenon after years of enthusiasm for index-based strategies.
“In a volatile 2025 market, 62% of U.S. investors say they don’t want to rely solely on market returns, signaling a clear shift toward active strategies,” notes Natixis. “Four in five aim to outperform the market, while 43% worry the ‘Magnificent 7’ could drag down index performance, and 44% feel passive investing doesn’t offer enough protection.”
As for advisors, it is times like these that highlight the importance of practical, professional advice. Fortunately, clients and prospects realize this with many opting for traditional advisor relationships or, at a minimum, choosing a hybrid model.
“Amid this uncertainty, U.S. investors are also placing greater trust in financial advisors; two-thirds receive professional advice, and more say they trust their advisor (96%) than themselves (89%) when making financial decisions,” adds Natixis. “However, few (13%) want to fully hand over control: 23% prefer to decide independently with guidance, 36% see their advisor as a partner, and 29% want to stay involved in major decisions.”
Points of Emphasis for Clients
Successful advisors are anticipatory, meaning they know at least a few of clients’ demands and expectations before those things are verbally expressed. Not all of those demands are investment driven. For example, Natixis points out that nearly half of U.S. clients want more coaching while 41%value access to their advisor and almost 40% simply want to feel heard. In other words, soft skills remain important parts of the advisor toolbox.
In terms of specific asset classes and services, clients want more access to private assets and more tax mitigation strategies. Natixis notes almost eight in 10 clients view tax management as essential to their long-term success and a comparable percentage entrust that service to their advisors. Regarding private assets, advisors would do well to be educated and prepared because interest is surging.
“Interest is rising in private assets (40%), but only 24% currently invest in this category,” concludes Natixis. “Over a third (37%) of U.S. investors say private assets are a good way to manage risk in their portfolios, and 36% say their returns are worth the associated fees. At the same time, they believe private assets are riskier than public investment (71%), and recognize they require special tax reporting (61%) and long holding periods (43%).”