RiskMonitor survey, Elizabeth Corley, chief executive at AllianzGI Europe, said: "We see massive de-risking in portfolios away from equities. Many institutional investors do not own equities. The average German pension fund owns less than 5% in equities and perceives even that as a risky position. But equities will hedge a 3-7% inflation risk, which bonds will not do".

The RiskMonitor survey reflects this trend, with only the Nordics and the UK – the regions traditionally associated with being the home of the heaviest equity investors – citing sharp equity market falls, together with interest rates, as the biggest risk over the next 12 months. Overall, 10.7% of survey participants named equity market falls as their biggest risk, with 54.8% still classing it as a considerable risk.

The survey also revealed that environmental, social and governance (ESG) criteria rank low in investors' perception of non-financial risks. None of the respondents thought it was a huge risk, while a mere 3.4% classed it as a considerable risk – all of them Austrian investors.

Across Europe, a slight majority of respondents, 52.1%, did not view ESG criteria as a risk at all, while 44.5% perceived it as a minor risk. A total of 156 institutional investors – predominantly pension funds – took part in the survey, which was carried out by IPE between March and April.

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