Advisers believe Covid uncertainty will be the biggest financial risk for the industry in 2022.
Some 66 per cent of advisers surveyed by Quilter said new Covid variants and the speed of global vaccination campaigns were their biggest concerns for next year.
Quilter surveyed 295 advisers at its 2022 global outlook event on November 30.
A further 19 per cent said they thought the biggest risk was inflation, with one in eight (12 per cent) saying they were most concerned about strong economic growth either failing to materialise or being very short lived.
Just 4 per cent said a central bank policy error was their biggest fear.
Markets have seen a period of volatility since a new strain of Covid was discovered.
The FTSE 100 fell 3 per cent on November 26 as news of the Omicron variant was announced. It has since recovered slightly but is still lagging considerably behind its highs in mid November. Over the past month the index is down 1.24 per cent.
The German Dax index and French Cac fell by about 3 per cent and 3.5 per cent respectively at the time. The Cac is down 1.83 per cent over the month.
Danny Knight, head of investment directors at Quilter Investors, said while Covid was a concern, the quick recovery of markets showed that investors were increasingly coming to terms with life in a post-pandemic era.
“Indeed, the volatility witnessed is nothing compared to what we saw in 2020 and investors are becoming increasingly less concerned as to news of the next stage of the coronavirus’ life cycle,” he said.
He said this suggested more fundamental market drivers such as company earnings, investor sentiment and the outlook for inflation and interest rates would play a far greater part in deciding how markets perform in the year ahead than the latest discoveries about the coronavirus and its variants.
“Advisers and investors need to be alert to other risks as the recovery plays out.
“All eyes are going to be on central banks in the early part of next year as higher inflation continues to take root.
“Much of the recovery now depends more on their next move than what happens with the coronavirus, so one misstep could have serious ramifications for investors over the medium term.”