Alexander Schindler, the firm’s management board member responsible for business with institutional clients, said: “Many institutional investors in Germany are evidently rethinking their investing strategy and adapting it to bring it more into line with investment reality.”He said the hunt for returns was causing many investors to climb further up the risk ladder. The survey’s respondents expected that, on average, 60% of institutional investors across Europe would fail to achieve the investment targets they had set themselves over the next three years.In Germany, survey participants expected 64% of investors to miss their investment objectives on average.Although the low-interest-rate environment was given as a reason for their pessimism, this was far from being the only factor respondents cited.Only 16% of all investors surveyed across Europe said low interest rates were the key issue, while in Germany 49% of the investors said this was the case. In the UK, 13% of investors picked the low-interest-rate environment as the biggest hurdle, followed by 10% in the Netherlands and 6% in Scandinavia. Schindler said these findings were unsurprising since German investors’ portfolios were still dominated by interest-bearing investments.“In contrast, many European investors have always had a higher weighting of investments offering greater upside potential, such as equity investments,” he said.Some 65% of those surveyed across Europe said they had noticed a trend among investors towards herd behaviour, which they believed increases the risk of bubbles forming and stock markets crashing. In Germany, the proportion of institutional investors holding this opinion was higher at 74%.Nearly two-thirds, or 63%, of all participants thought the markets would become more volatile, and 47% said they expected it would become much harder to predict the behaviour of other market players. German institutional investors appear far more risk-averse than their counterparts in the UK, the Netherlands and Scandinavia, according to data gathered in a new survey, with 82% of respondents in Germany declaring the avoidance of losses to be their highest priority.By comparison, 75% of institutional investors in Switzerland and 69% in Scandinavia claimed the avoidance of losses as their main priority, and just 62% and 61% of investors in the Netherlands and the UK, respectively, said this was their main goal, according to findings from Union Investment’s latest risk management study.The research surveyed 212 institutional investors in eight European countries about how they preferred to invest.The cautiousness of German investors was less pronounced than last year, however, with their risk aversion having come down by 7 percentage points since the 2015 survey, Union Investment said.