Despite significant volatility across global markets throughout the first half of 2025, Australian investors remain optimistic about the outlook, and one-third intend to invest more over the next 12 months. This is according to Fidelity International’s Asia Pacific Investor Study, which aims to provide a pulse check of investor behaviour across Australia, mainland China, Hong Kong, Taiwan, Singapore, and Japan.

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Investor sentiment shows cautious optimism

The majority of Australian investors (69 per cent) are optimistic or very optimistic about the outlook for the stock market in the next 12 months, compared to China (50 per cent), Singapore (43 per cent), Hong Kong (24 per cent), Taiwan (25 per cent) and Japan (22 per cent).

While the cost-of-living crisis experienced in locations across the region has not disappeared, Australian investors feel comparatively comfortable with their financial situation, with 17 per cent saying they are very comfortable and 53 per cent saying they are comfortable.  Just six per cent of Australian investors say they are struggling. This compares favourably with the APAC region, where 51 per cent of APAC investors defined their current situation as ‘very comfortable’ or ‘comfortable’, 39 per cent as ‘coping’ and 10 per cent as ‘struggling’.

Simon Glazier, managing director of Fidelity Australia, said despite macro-economic volatility and turmoil, the study shows that Australians continue to have confidence in their investment strategies and display resilience in responding to changes in the economic environment.

“The first six months of 2025 have been a roller-coaster but our research shows a sense of confidence among Australian investors. On the whole, they are feeling positive about the outlook, both for their own portfolios and for the broader market, and are positioning themselves to take advantage of opportunities that may arise.

“Supporting their confidence may be the fact that superannuation funds have returned strong performance for the last financial year which highlights the importance of tuning out short-term market noise and focusing on long term strategies.

“Interestingly, younger Australian investors aged between 18 and 39 are more likely to feel comfortable with their financial situation than those aged 40 and above, perhaps because older investors are more concerned about whether they have the time to ride out the current volatility in their investments.”

Chart 1: Australian investors’ current financial situation

According to the survey, over half (54 per cent) of Australian investors expect returns of 10 per cent or higher from their long-term investments (those held for a minimum of five years).  Furthermore, despite the economic uncertainty, almost half (46 percent) of Australians don’t intend to change their investment plan during the next 12 months, and 33 per cent of Australians say they will invest more.

However, the market volatility experienced since the start of 2025 has clearly had an impact on investor behaviour, with 47 per cent of APAC investors indicating that they been checking their investment portfolio more often this year. Australian investors are the most likely to check their portfolios, with 61 per cent saying they are checking it more often.

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The end of US exceptionalism?
As US equities have been popular in investors’ portfolios through the bull run of recent years, the survey sought to understand whether this has changed through the first half of 2025. For those APAC investors holding US equities, almost one quarter (23 per cent) have decreased their allocation since the start of the year, while another 23 percent have taken the opportunity to increase exposure and 54 per cent have held it the same. Australians are the most likely to have increased their allocation (38 per cent) while investors in Hong Kong and Taiwan have decreased their allocation to US equities the most (37 per cent and 30 per cent respectively).

Asset allocation preferences
In terms of sector and geographic preferences for the next 12 months, APAC investors are aligned. The top investment sector across all markets surveyed is information technology. Australia investors also showed a preference for energy and real estate.

Chart 2: Sectors APAC investors intend to allocate to

Australian investors are also particularly interested in digital assets such as cryptocurrency, with 38 per cent of Australians investing in digital assets which is the highest in the region, followed by Singapore (26 per cent).  A further 25 per cent of Australians say they will increase their allocation to digital assets in the next 12 months. Australians are also the largest investors in private asset funds (11 per cent).

Over half of Australians surveyed (52 per cent) are invested in ETFs and of these, 51 per cent say they find active ETFs more appealing than passive options, with just seven per cent of investors preferring passive ETFs.  The main attractions of active ETFs are the ease of transaction, flexibility, that they save investors’ time.

Simon Glazier comments: “Overall, the study suggests that a profound transformation is underway in the regional investment landscape. Investors are rapidly shifting away from traditional vehicles like term deposits, insurance and real estate, and seeking greater diversification through emerging investment tools.

“It’s encouraging to see more APAC investors choosing to increase their investments rather than reduce them during this period of market volatility. While daily fluctuations can feel unsettling, volatility is a natural and inevitable part of investing. During market corrections, it may even create attractive opportunities, setting the ground for boosting long-term rewards, especially for equity investors with a long-time horizon. Staying invested in a well-diversified portfolio remains the be