9 in 10 advisers expect increased returns over the next decade, despite geopolitical risks

Almost nine out of 10 advisers (88%) expect a rise in returns over the next decade, with an upward trend in equities, despite the majority (62%) predicting an increase in geopolitical disruption. 

This continued growth in market volatility has been highlighted by the latest Investor Confidence Barometer from Scottish Widows, which surveyed 200 UK-based financial advisers and paraplanners on market pressures, macroeconomic predictions and client demands to provide a holistic view on adviser sentiment.

Volatility expected to increase

More than half (54%) of advisers anticipate market volatility to increase over the next five years. Although this figure is high, the overall sentiment is down from 2024, when nearly three quarters (74%) expected to see turbulent markets.  

Despite believing that equities will rise over the next decade, advisers are more bearish when asked how returns will hold up versus historic averages – 29% expect them to trend lower, and 15% higher. Respondents are split on bond returns, with a fifth (20%) expecting them to trend higher and over a quarter (27%) lower. Two-thirds (67%) of advisers expect inflation to be sticky, staying at the same level or increasing through to 2030 but well-over a half (59%) anticipate lower interest rates in the same time period.

Tariffs, recession and conflict drive adviser fears – but not AI

Advisers see geopolitical conflict (40%) as the biggest threat to equity markets in the next five years, closely followed by trade barriers (29%). It’s firms managing more than £500 AUM where this flips and trades barriers become the  priority concern (41%). 

The fear of a sustained downturn or recession keeps one in 10 (11%) advisers worrying and despite growing market concentration, just 8% see a valuation bubble as the greatest threat.

Jenny Davidson, Intermediary Wealth Director at Scottish Widows, said: “Advisers anticipate a challenging run to 2030. Heightened international tensions, the potential of further trade tariffs and persistently sticky inflation are causing unease across markets. Advisers face a delicate balance of keeping their existing clients’ financial plans on track while navigating a shifting and challenging business environment. 

“Stability is key – both for advisers and their clients – particularly in periods of sustained uncertainty. That means having the right tools and support in place to help advisers respond to market pressures, adapt to change and maintain confidence in the plans they set for clients. In an environment like this, consistency and reliability become just as important as performance – helping advisers keep clients focused on their long-term goals.”