14 July 2026
If the preferred asset class in your client’s investment portfolio is cash, they’re probably anxious, deeply averse to risk and trying to play it safe in a profoundly uncertain market. However, their portfolios might feel safe now, but they are missing alpha opportunities, if not now, then later.
If your clients are spooked by what’s happening in the world and, consequently, what’s happening in the markets, it’s the responsibility of their trusted financial adviser to be the voice of reason, calm and objectivity, to create a diversified portfolio that can withstand volatile market conditions.
Seven tips for no-risk clients in uncertain times
Seven things to know as you deal with clients who have a no-risk approach to investing in these troubled times.
- A client’s fears are real – to them.
We can’t glibly wave away our clients’ fears. A good place to start in the advice process is to acknowledge their fears and openly talk about where these fears are rooted. South African investors are facing profound financial challenges in this time and space. In the middle market (the shrinking layer in our economy), consumers face seemingly infinite pressures on a day-to-day basis, brought about as a result of macro-economic factors such as low and slow growth in our economy, geopolitical tension, and the increasing fuel price, which leads to price hikes in all spheres. Add to that unemployment and issues around job security, managing debt and the pressure placed upon ordinary people by economic instability.
- Clients might think of cash as king.
Clients might be apathetic to investing, given the local and global economic backdrop right now. Cash and money market instruments offer a coping mechanism for their anxiety. They offer an investing safe haven as they tick three important boxes – security, certainty and quick liquidity should they be faced with a financial emergency.
- Every client has a relationship with their money.
Naturally, this relationship is often emotional. Importantly, as in every relationship, your client has certain expectations. As an adviser, you need to establish what their expectations are in terms of the four factors in investing – the risks they are willing to stomach, the returns they expect, the tax efficiency they desire and the liquidity they need. When clients can earn relatively attractive yields with low volatility, and they have daily liquidity, it reinforces their desire for short-term gratification. The question that drives their behaviour would be: “Why should I take a risk if I’m getting paid to wait?”
The problem, of course, is that this is usually temporary and often, over time and due to inflation, erodes wealth.
- Diversification plays a role in reducing risk.
Once you have established the reasons for your client’s portfolio being solely in cash, their expectations, as well as their short-, medium-, and long-term goals, a shift toward diversification becomes possible, as a picture starts to form that gives them a view beyond the immediate market noise.
- Shifting is a slow, meticulous, intentional process.
Rather than shifting all at once, blending different asset classes over time is key. Combining cash, bonds, income-paying and low-risk equities can create smoother transitions and reduce volatility.
- Going offshore is not a nice-to-have.
Offshore investing offers a breadth and depth of opportunities that simply do not exist locally. With an anxious investor, though, it might take time to build up to including global opportunities. A plan-based approach to portfolio design cannot exclude offshore investing.
- Get back to basics.
For financial advisers, it is important to develop a deep understanding of your client and to ensure their investment plan is embedded/positioned within a turnkey financial plan that takes their needs and circumstances into account. This approach includes debt management, property portfolios, goal-driven savings, retirement savings and retirement income planning.
Cash protects today, but limits tomorrow
While cash instruments might feel safe for your client right now or during times of negative market events, staying in cash for the long-term has negative consequences. When the market corrects, the lost opportunities are unthinkable. Your client doesn’t need to go all-in in the market, but they need to stop being all-out.
References:
• https://www.statssa.gov.za/?p=18738
• https://www.treasury.gov.za/documents/National%20Budget/2026/
• https://www.strategyand.pwc.com/a1/en/insights/south-africa-economic-outlook.html?
• https://www.resbank.co.za/en/home/publications/publication-detail-pages/quarterly-bulletins/quarterly-bulletin-publications/2025/december
