“In the first half of 2025, many self-directed SMSF investors increased their exposure to familiar, high-yielding stocks – particularly in large-cap Australian miners and banks.”

He said data shows that the top trades for this cohort included BHP Group (BHP), Fortescue (FMG), Woodside Energy Group (WDS), and Pilbara Minerals (PLS) while Commonwealth Bank of Australia (CBA) remained a cornerstone in many self-directed SMSF portfolios.

“This is a testament to the continued allure of blue-chip stocks with perceived defensive characteristics and stable dividends,” Hill said.

“However, this familiarity-driven concentration may result in inherent risks. Market analysts have noted that portfolios that are heavily weighted toward a few sectors or companies could be more vulnerable to macroeconomic shifts or valuation corrections.”

By contrast, Hill said, SMSF investors under advice demonstrated more diversified asset allocation with nearly half of all top SMSF adviser-led trades in H1 2025 involving ETFs.

“This suggests a preference for investment vehicles that offer sectoral and geographic diversification.”

“SMSF advisers are also tapping into tactical ETF usage – such as geared or hedged products such as BetaShares Geared US Equity Fund (GGUS) and Global X Ultra Short Nasdaq 100 Hedge Fund (SNAS) – to express market views or manage volatility more nimbly than would be possible through direct equities.”

Hill continued that SMSF investors with balances over $3 million, while still allocating to high-dividend Australian equities such as BHP and Woodside, are simultaneously deploying capital into international ETF products to reduce home bias and enhance resilience.

“There is also evidence of defensive repositioning through healthcare exposures, such as CSL, and multi-asset ETF strategies, which may reflect broader awareness of risk-adjusted return considerations.”

“These data trends underscore an important point for advisers: while retail investors continue to chase performance in sectors they know, the value of advice lies in helping clients avoid concentration traps and adopt diversified, evidence-based portfolios.”

Furthermore, advisers are increasingly leveraging ETFs not only for cost efficiency and liquidity, but also for their utility in tailoring portfolios to individual risk tolerances, income needs, and global diversification goals.

“As investor confidence fluctuates and asset prices remain elevated, financial planners should continue to focus on helping their clients to understand the benefits of diversified portfolios and disciplined portfolio construction – balancing active tilts with strategic ETF building blocks, managing behavioural risks, and aligning investment choices with long-term client goals,” Hill added.

“The growing inclusion of ETFs in advised SMSF portfolios – from passive global equities to defensive credit strategies – reflects a maturing approach to wealth protection and growth. For SMSF advisers, this presents an opportunity to further differentiate their value by delivering clear, diversified, and intentional investment strategies that transcend short-term market noise.”