‘Risk Aversion Has Risen Sharply,’ Says Schwab Asset Management CEO

FomoAnxiety · 2026-03-20T21:41:26+00:00

Investor behavior has shifted towards increased risk aversion, influenced by rising gas prices, inflation fears, and geopolitical tensions, leading to more cautious market actions and a focus on consumer spending as a crucial economic indicator.

FomoAnxiety

2026-03-20 21:41:26

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Investor behavior has changed noticeably over the past few weeks, as risk aversion has risen sharply, according to Omar Aguilar, CEO and CIO of Schwab Asset Management SCHW +0.18% ▲ . Speaking on Bloomberg TV, he explained that sentiment has shifted from fear of missing out on gains to a stronger focus on avoiding losses. At the same time, ongoing geopolitical tensions are increasing uncertainty, and that stress is now affecting not just markets but also people’s day-to-day lives.

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As a result, rising gas prices and the risk of higher inflation are making investors more cautious. Indeed, Aguilar said that many investors are now reluctant to hold positions over the weekend because of how unpredictable the situation has become. And given the wide range of possible outcomes, he recommends staying prepared instead of taking extreme positions. This is because although markets can recover quickly if tensions ease, a longer-lasting conflict could put real pressure on economic growth.

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Furthermore, Aguilar believes that markets may not be fully reflecting the long-term economic impact yet. Even though investors are already pricing in higher inflation and interest rates, the full effect on the economy, especially consumer spending, may still be underestimated. He also noted that, unlike in 2022, the current environment provides some support for risk assets, even as bonds take the initial hit. Still, he warned that consumer spending will be the key metric to watch, and if the conflict continues, the economic damage could become clearer over time.

Is SPY Stock a Good Buy?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on the SPDR S&P 500 ETF Trust SPY -1.59% ▼ based on 412 Buys, 81 Holds, and 10 Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average SPY price target of $833.11 per share implies 28% upside potential.

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