According to Fidelity, investors lean further into US equities and incorporate more hedging tools and alternatives, signalling a nuanced approach to risk amid ongoing economic uncertainties in 2026.
Investors appear to have leaned a little further towards the US in the first half of 2026, even as they resisted the sort of broad de-risking many had expected amid uncertainty over inflation, politics and artificial intelligence, according to Fidelity.
The custodian reviewed 5,579 adviser portfolios and found that clients marginally increased their domestic equity exposure while trimming overseas holdings. Fidelity said US stocks accounted for 79% of the equity sleeve in the second quarter, up from 77% in the first, while international shares slipped to 21% from 23%. That marks a continuation of a longer-term preference for home markets, with international allocations having stood at 27% in 2021.
Mayank Goradia, head of portfolio construction at Fidelity and chief investment officer of Fidelity Institutional Wealth Advisors, said in a webinar on Friday that investors were not moving sharply into cash or retreating from risk. Average equity exposure remained close to 72%, while fixed income sat at about 23%, a level he described as near the lower end of the range seen over the past two years.
He said the more notable shift was not towards caution, but towards different forms of risk. Advisers, he said, were increasingly using exchange-traded funds and adding liquid alternatives and other hedging tools to portfolios rather than abandoning equities altogether.
One of the clearest themes in the data was the extent of home-country preference. Goradia said 27% of the portfolios Fidelity reviewed had no international equity exposure at all, which he described as a substantial bias towards the US.
The move into ETFs has also quickened. Fidelity said average allocations to index funds rose to about 42% in the second quarter, compared with 39% in the first and roughly 30% over the prior two years.
Fixed income allocations also became a little more defensive. Investment-grade bonds rose to 83% of bond exposure from 81%, while high-yield debt fell to 17% from 19%. Average duration shortened to 4.38 years from 4.71.
Goradia pushed back on the idea that the traditional 60/40 portfolio has become obsolete. Instead, he said advisers are updating the framework after the inflation shock of 2022, when stocks and bonds fell together and challenged the assumption that the two asset classes would always offset one another.
According to Fidelity, the response has been to widen the range of diversifiers inside portfolios, including multi-sector bond funds, alternative strategies and outcome-oriented products. Goradia said the aim remains the same: growth, income and risk management. The difference, he said, is that advisers increasingly want more than two sources of return.
He said alternatives are often being used as a form of portfolio insurance, with liquid market-neutral strategies attracting particular interest. Among advisers engaging with Fidelity, roughly 10% to 20% have some exposure to alternatives, he said.
Brad Pineault, Fidelity’s head of capital market strategies, also used the webinar to address whether the rapid spread of artificial intelligence can justify the heavy investment flowing into the sector. He said the key question is whether AI can deliver enough productivity gains to support broader economic growth and, in turn, a wider base of earnings.
That debate is sharpened by the scale of expectations already embedded in the market. Pineault pointed to forecasts for 30% earnings growth in the S&P 500 in 2026, even as consumer sentiment remains subdued under the pressure of inflation and higher borrowing costs.
The contrast, he suggested, underlines a split between financial markets and household experience: investors are looking at the prospects for large public companies, while many consumers are still dealing with tighter budgets and more expensive credit.
- https://www.fa-mag.com/news/fidelty-notes-home-country-bias-in-advisor-allocations-88313.html – Please view link – unable to able to access data
- https://www.fidelity.com/wealth/personalized-portfolios – Fidelity offers Personalized Portfolios, tailored investment strategies designed around individual financial goals, risk tolerance, and time horizons. These portfolios are constructed with a mix of investments, including equities, fixed income, and alternative assets, to align with clients’ objectives. The service provides ongoing active management, ensuring portfolios adapt to market changes and personal circumstances. Additionally, Fidelity employs tax-smart strategies to enhance after-tax returns, applying up to eight tax-efficient techniques throughout the year. This comprehensive approach aims to help clients achieve their financial goals while managing risk effectively.
- https://www.fidelity.com/mutual-funds/fidelity-fund-portfolios/overview – Fidelity’s Fund Portfolios—Diversified offer two strategies for creating a diversified investment portfolio: model portfolios and single-fund strategies. Model portfolios provide a mix of Fidelity mutual funds based on risk tolerance and financial situation, serving as a starting point for investors. Single-fund strategies involve Fidelity-managed funds that require no research or rebalancing from investors. These portfolios are designed to help investors achieve greater potential risk-adjusted returns over the long term, with options ranging from conservative to aggressive growth strategies.
- https://institutional.fidelity.com/advisors/investment-solutions/model-portfolios/explore-models/target-allocation-models – Fidelity’s Target Allocation Model Portfolios are diversified investment solutions targeting various risk levels. These models provide low-cost, comprehensive portfolio options or can serve as a core part of a broader portfolio. They are designed to help clients reach their financial goals by offering diversified allocations across multiple asset classes, including equities, fixed income, and alternative investments. The portfolios are managed to adjust to market changes, ensuring alignment with clients’ investment objectives and risk preferences.
- https://www.kiplinger.com/investing/mutual-funds/604463/kiplinger-25-model-portfolios – Kiplinger’s 25 Model Portfolios guide presents three distinct investment strategies using Kiplinger’s selected no-load mutual funds, tailored to varying investor goals, risk appetites, and time horizons. The Aggressive Portfolio allocates 80% to stocks and 20% to bonds, suitable for long-term investors. The Moderate Portfolio, with a 70/30 stock-bond mix, is suited for a mid-range horizon. The Conservative Portfolio emphasizes income with a 70% bond and 30% stock mix, ideal for short-term goals. Each portfolio serves as a starting point, allowing customization based on an individual’s financial goals and risk tolerance.
- https://www.kiplinger.com/investing/mutual-funds/kiplingers-mutual-fund-guide – Kiplinger’s Mutual Fund Guide for 2026 presents a comprehensive analysis of top-performing mutual funds across various categories based on 2025 performance and longer-term returns. In 2025, foreign markets outshined U.S. stocks, with the MSCI All Country World Index ex-USA returning 32%, surpassing the S&P 500’s 18% gain. European and emerging markets led the rally, aided by a weakening dollar. The guide highlights the best stock mutual funds in categories such as large-, mid-, and small-cap, hybrid, foreign, sector-specific, global, emerging markets, and alternative strategies.
- https://www.kiplinger.com/investing/hybrid-adviser-services-reviewed – This article from Kiplinger reviews seven hybrid investment advisory services combining automated digital tools with human financial advice. As robo-advisers grow and evolve, hybrid models have gained popularity, offering investors both the benefits of automation and the reassurance of expert guidance. The reviewed services include Axos Invest, Betterment Premium, Fidelity Go Plus Coaching, J.P. Morgan Wealth Management, Merrill Guided Investing with an Advisor, SoFi Robo Investing, and Vanguard Personal Advisor. Key differences lie in minimum investment requirements, annual fees, access to certified financial planners, and availability of dedicated advisers.
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The article was published on August 31, 2026, and reports on data from the second quarter of 2026. A search for similar narratives reveals that this specific analysis has not been widely reported elsewhere, indicating originality. However, discussions about home-country bias in investment portfolios are common, with similar themes appearing in other publications. For instance, an article from July 2026 discusses the hidden costs of staying close to home in investment decisions. ([rpc.cfainstitute.org](https://rpc.cfainstitute.org/blogs/enterprising-investor/2026/home-bias-cost-staying-close-to-home?utm_source=openai)) This suggests that while the specific data may be new, the broader topic has been covered recently. Given the lack of earlier publications with identical figures and quotes, the freshness score remains relatively high.
Quotes check
Score:
7
Notes:
The article includes direct quotes from Mayank Goradia, head of portfolio construction at Fidelity, and Brad Pineault, Fidelity’s head of capital market strategies. A search for these quotes reveals no exact matches in earlier publications, indicating they are original to this article. However, the absence of these quotes in other sources also means they cannot be independently verified. This lack of external verification slightly lowers the score.
Source reliability
Score:
9
Notes:
The article originates from Financial Advisor Magazine, a reputable publication in the financial industry. While it is a niche publication, it is well-regarded within its field. The content appears to be original reporting rather than a press release, which is a positive indicator. However, the magazine’s focus on financial advisors means it may have a specific audience, which could limit the generalizability of the findings.
Plausibility check
Score:
8
Notes:
The claims about increased domestic equity exposure and decreased international holdings align with known investment trends. Fidelity’s data showing US stocks accounting for 79% of the equity sleeve in Q2 2026 is plausible and consistent with broader market observations. The discussion on home-country bias and the use of ETFs and alternative investments also reflects current industry practices. However, the article does not provide detailed data or sources for some claims, such as the specific percentage of portfolios with no international equity exposure, which slightly reduces the score.
Overall assessment
Verdict (FAIL, OPEN, PASS): REVIEW
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The article presents original reporting on Fidelity’s analysis of advisor allocations, with specific data and quotes not found elsewhere. However, the reliance on Fidelity’s own data without independent verification raises concerns about potential bias and the need for further corroboration. Additionally, while the broader topic of home-country bias is well-known, the specific findings presented are novel. Given these factors, a REVIEW verdict is appropriate, and further independent verification is recommended before publishing.