Equally as important, members are predicting large-scale bankruptcies (39%) and also an acceleration of automation to reduce costs (38%). Further consolidation was also a theme, as well as divergence between emerging and developed markets and a potential reduction in the globalization of financial markets, CFA Institute reported.
Some 42% of CFAs believe it is unlikely that the crisis will reverse the steady shift of investment managers and investors into passive investments.
As for the interventions by governments and central banks, the majority of respondents indicated that this was a major stabilizing factor, but with differences in regional opinion on whether this should continue. Some 49% believe that current state aid will be insufficient and will need to continue, while an equal number of CFA believe the aid should be a short-term measure, CFA Institute reported.
On the regulatory front, 50% of CFAs said that conduct regulation should not be relaxed to encourage greater trading and liquidity, while 26% thought that it should be relaxed. Some 69% of CFAs believe that “regulators should actively seek the appropriate response through consultation with industry,” the survey found.
These were among other findings:
• 75% of CFAs said that companies that receive emergency support during the crisis should not pay dividends or compensate executives with bonuses.
• 83% do not want a ban on short-selling considered.
• 84% want regulators to undertake a review of ETF activity during the crisis to determine potential systemic impact.
• 94% think regulators should focus on investor education about the risk of investment fraud during times of crisis, while 82% want continued market surveillance.
• 82% of CFAs think regulators should not consider imposing security market holidays 73% believe that regulators should not temporarily permit companies to delay reporting on changes in their financial conditions.
While it may be too early to gauge the long-term impact of Covid on CFAs’ employment, 54% of CFAs see no change in their firm’s hiring plans and 36% report a hiring freeze, but only 9% report that their firm is downsizing.
The survey was filled out by 13,728 CFAs between April 14 and April 24, 2020, the CFA Institute said.