Fraser Allan

Australian investors and traders remain nervous about markets but are continuing to invest and trade through uncertainty, maintaining exposure despite rising caution and concerns over mounting macro headwinds, according to new research from global online multi asset provider, CMC.

CMC surveyed more than 8,500 Australian investors and traders, finding that ongoing global uncertainty had led more than half (56.1%) of all respondents to become more cautious. However, almost nine in ten (87.1%) said they planned to invest the same, or even more, over the next six months.

Among those who were more cautious, one third (31.8%) of the respondents said they plan to invest or trade more in the next six months, while only 12.8% plan to invest or trade less.

Commenting on the findings, Fraser Allan, Head of Premium Client Management at CMC, said nervousness was reflected in mindset not allocations, with investors and traders choosing to stay the course despite ongoing uncertainty and volatility.

“This is a story of calibration, not capitulation. Investors and trades are acknowledging the risks and adopting a more considered mindset, but uncertainty has not driven them away from markets,” Mr Allan said. “Rather than stepping back, they appear to be reassessing how and where they participate, a measured response that reflects neither complacency nor retreat.

“That’s a meaningful shift from what could be expected, given that uncertainty has in the past led some retail investors and traders to flee to cash. This time, some investors and traders are staying in the market and adjusting how they participate.”

Cash, not conviction, is the handbrake

Asked what is most preventing them from investing more, respondents pointed at their own bank balance rather than geopolitics or volatility.

A lack of available cash was the single biggest barrier to investing (53.3%), outweighing volatility (18.5%), knowledge gaps (11.7%), geopolitical tensions (10.2%), and fear of losses (6.3%) combined.

“The headlines are geopolitics and volatility, and those things are real,” said Mr Allan. “But when we ask respondents what’s actually holding them back, one in two say it’s simply that they don’t have the spare cash. Fear of losing money comes in at just six per cent.”

AI has moved into the mainstream of retail investing

Nearly half of investors and traders surveyed (48.6%) now use AI tools to support investment decisions, with 33.1% using it occasionally and 15.6% regularly.

From the survey results, investors and traders are using it across the investment spectrum, including researching companies (21.0%), learning/education (19.7%), market analysis (17.7%), and generating trade ideas (11.4%). However, trust has not kept pace. Fewer than a third (29.4%) say they trust AI-generated market insights.

The survey shows investors and traders who have adopted AI look markedly different from those who selected “not using”. Regular AI users are:

• Nearly twice as likely to be planning to trade more over the next six months (46.4% vs 25.0% of non-users)
• More bullish on markets (42.0% bullish or somewhat bullish, vs 26.7%)
• More confident in their own decisions (10.0% “very confident”, vs 6.8%)
• More globally exposed (29.2% increased US equity exposure, vs 15.1%)

“AI has arrived in retail investing faster than almost anyone expected,” said Mr Allan. “Those using AI are more active and more confident as they have the information that matters, cutting through the noise and abundance of information.

“It is providing a new resource to help support investors and traders for decision-making. However, a trust gap remains, with less than a third of respondents saying they trust what comes back. It seems investors and traders are still rightly questioning the outputs that AI delivers.”

The rise and rise of ETFs

ETFs were the most common way investors and traders who participated in the survey said they had added exposure in response to recent volatility. Nearly half (47.6%) increased their investment or exposure to index funds and ETFs, ahead of Australian equities (37.5%), US equities (21.0%), commodities (7.8%), and crypto (4.7%).

Looking forward, ETFs again led expectations for the best-performing asset class over the next six months (29.0%), ahead of US equities (21.3%), global equities (16.0%), Australian equities (15.7%), commodities (13.8%), crypto (3.3%), and FX (1.0%).

The findings echo CMC Invest’s 2026 H1 Inside Invest Report which identified the emergence of a “Big Four” ETFs (IVV, VGS, VAS and NDQ) accounting for approximately 75% of top-10 orders, with investors using ETFs as a route to US and global exposure.

“The index has become the default,” said Mr Allan. “When investors and traders are uncertain, they’re not going to cash and they’re not stock-picking their way out of it. They’re buying the market and getting diversified exposure to local and international markets through a handful of very large, very liquid ETFs.”

A market waiting for a catalyst

The survey reveals the largest group of respondents have no firm view on where markets will go next.

Uncertainty remains the key theme among investors and traders with four in ten (40.4%) neutral on the six-month outlook for markets, outnumbering both bulls (34.1%) and bears (25.5%).

Sentiment translates almost directly into intent. Among investors and traders who are bullish or somewhat bullish, 47.6% plan to invest or trade more, compared with 21.6% of those who are bearish or somewhat bearish.

“The biggest block in the market right now isn’t the bulls or the bears, it’s the undecided,” said Mr Allan. “That tells you this is a market waiting for a catalyst rather than one positioning for a direction. When that catalyst comes, whether it’s rates, earnings, or geopolitics, there’s a very large group of investors ready to move quickly.”

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Fraser Allan

CMC Invest, Australia’s largest non-bank share trading platform, has unveiled the investment behaviours of Australian retail investors in its inaugural Inside Invest Report.

The report reveals Australian investors remained resilient in the face of uncertainty in 2025, balancing diversification with selective conviction, and using volatility as a point of action, rather than an excuse for delay.

In a year dominated by global geopolitical uncertainty, trade tensions and interest rates that remained higher for longer rather than retreating to the sidelines, clients continued to invest through volatility. Across 2025, around 75% of all trades were ‘buy’ orders.

A clear trend emerged of investors looking to get broad local and international exposure through ETFs, with a clear ‘Big Four’ ETFs emerging – IVV, VGS, VAS and NDQ, ranking as the four most traded instruments overall.

“On the surface, 2025 appeared positive looking at the returns of major indices, both here and abroad. However, in practice, it was a difficult year to navigate,” said Director of Premium Client Trading ANZ at CMC Invest, Fraser Allan. “Rates remained higher for longer, trade tensions resurfaced, AI-driven enthusiasm intensified, and geopolitical pressures persisted. Euphoric rallies in gold and silver added to the sense of unease, pointing to growing uncertainty in global markets.

“Despite that backdrop, CMC Invest client behaviour in 2025 tells a story of resilience and discipline. When uncertainty rose, clients chose patience over panic. When opportunities emerged, they stepped forward with conviction.”

Home bias holds firm

Total orders executed on ASX-listed stocks were almost six times higher than those on US stocks in 2025, demonstrating a strong home bias when investing in individual companies.

Investment activity was concentrated in familiar blue-chip companies across financials, materials, and consumer stocks, broadly reflecting the structure of the Australian share market, as well as the appeal of long-term track records, brand familiarity, and dividend income.

Two blue-chip ASX companies illustrated how investors responded differently to volatility and changes in share prices during the year:

• CBA: investor activity was more evenly split, with 56% of orders on the buy side, potentially reflecting greater sensitivity to company-specific factors such as valuation.

• CSL: behaviour showed a clearer buy-the-dip pattern, with 84% of orders on the buy side as clients added exposure following a significant share price decline over the year.

Two names dominate US markets

Unlike the more even participation seen across ASX stocks, US investing concentrated in two retail favourites, NVIDIA and Tesla, that accounted for around half of all trades among the top 10 US stocks.

• NVIDIA: was the most traded stock on the entire platform in 2025, ahead of BHP and CSL, and the fifth most traded instrument overall, reflecting how strongly the AI narrative captured investor attention throughout 2025.

• TSLA: Similar to CSL on the ASX, clients showed a tendency to “buy the dip”. April was the second-strongest buying month (behind July), with 77% of orders on the buy side.

Crypto goes mainstream

Bitcoin trading activity further highlighted how portfolios are evolving. By total orders executed, Bitcoin ranked ninth overall traded instrument, and fourth when ETFs are excluded, placing it alongside the platform’s most actively traded assets.

Around 82% of Bitcoin orders were placed on the buy side, a much stronger skew than seen in most top ASX and US stocks. This level of buy-side activity is notable given Bitcoin’s elevated volatility during 2025, including two drawdowns of roughly 30%.

Despite this, client behaviour remained strongly skewed towards accumulation.

Strong buying conviction in offshore markets

Outside the ASX and US, trading activity in 2025 showed a more adventurous streak, as clients explored a broader mix of global opportunities across the additional 14 international markets available on the CMC Invest platform.

Metaplanet emerged as CMC Invest’s most traded stock outside the ASX and US markets in 2025, reflecting elevated retail interest in Bitcoin treasury companies.

China, via Hong Kong, dominated offshore trading with EV heavyweight BYD, and HK tech leaders Alibaba, Xiaomi and Tencent all featuring in the top 10 traded stocks outside Australia and US.

“Overall, 2025 reinforced some familiar lessons. Markets rarely move in straight lines, and progress often comes from staying disciplined through uncertainty,” Mr Allan said. “Local investors remained engaged, navigating a challenging year with a clear focus on long-term outcomes rather than short-term noise.”

“Looking ahead to 2026, uncertainty and market volatility are likely to persist. Against this backdrop, we expect investors to remain active in identifying opportunities, both domestically and offshore, using diversification and exposure to high-quality blue-chip companies to support long-term investment goals.”

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