Investors are opting for more traditional, secure investments such as bonds and property in response to the current economic environment, new research shows.

A UK-wide survey by law firm Michelmores of 1,500 affluent millennials, Gen X and baby boomers reveals that the cost-of-living crisis has changed investors’ attitudes to risk and impacted the way people are choosing to invest their money.

Each of the generations surveyed all have a higher interest in traditional forms of investment, such as cash and property, than two years ago. The research also indicates that investors are highly unlikely to buy into ‘riskier’ assets such as cryptocurrency in the coming year.

Richard Cobb, senior partner at Michelmores, said: “The instability caused by Brexit, the pandemic, and the war in Ukraine – on top of a forecasted global recession – has led to investors being more risk averse in their financial decisions.

“Investors are becoming disillusioned with riskier asset classes such as cryptocurrency and are instead choosing traditional forms of investment, such as cash, bonds and property.”

As part of its research, the law firm also focussed on a large sample of investors in the East Midlands. The study found that investors view cash (31%) and bonds (21%) as the best protected investments, and are more likely than any other region to invest in bonds. In fact, 17.8% said they had invested more in this asset due to the current cost of living crisis and rising inflation.

Local investors were also more likely to have money in a pension than any other region (37.7% versus the UK average of 31.2%).

Property (20%), equity funds (12%) and commodities (4%) are less popular, with investors from the East Midlands less likely to have money invested in commodities than any other region. There is a very low appetite for investment in cryptocurrency (8%), a view held by investors across the UK.

“While our data suggests that awareness of risk is heightened in each generation, more confident investors with a longer-term outlook may seize the opportunity to buy up assets while the value is low and potentially reap the rewards,” Cobb added.