People around the world are searching for ways to shield themselves from the impact of stubbornly high inflation, and the rich are no exception.

Nuno Matos, HSBC’s CEO of wealth and personal banking, told CNN Business that global investors were “not being as active as they used to be,” with many looking to sell off what they see as riskier bets and “buying more protection for their portfolios.”

“We see customers sitting a little bit in the sidelines,” Matos said in an interview on Monday, adding that many had turned to bonds as they search for some “stability.”

“There is one common element that all of them are very concerned [about],” he added.

Inflation is putting immense pressure on households worldwide as they grapple with higher costs of living, as well as squeezing the margins of many businesses. Economies are stalling, and recession fears are mounting.

Stocks are suffering as a consequence. Global markets are down more than 20% so far this year.

Annual inflation in the European Union stands at 9.1%, while the United States rate remains at 8.3%. Inflation in the United Kingdom recently hit a 40 year high before abating slightly to 9.9% last month. Part of Asia are also experiencing rising prices.

That has led central banks to hike interest rates “with a degree of synchronicity not seen over the past five decades,” according to the World Bank.

Matos told CNN Business how Europe’s biggest bank was advising its customers, which include both high-net-worth and retail investors, to play defense.

For starters, diversification — long one of the golden rules of investing — is now not just nice to have but “mandatory,” said the executive.

He also suggested investors explore “value” stocks versus “growth” stocks, essentially prioritizing big companies with stable market share and healthy payouts for shareholders over other fast-growing businesses.

Even as many people sell assets, “you want to keep invested,” said Matos, noting the adverse effects of retaining cash during a high inflation period.

The banker also said his team was bullish on the strength of the US dollar, partly because it felt the American economy had been “weathering the storm better than, for example, the European economy.” The US dollar has soared to near its highest level in 20 years, while many other currencies have tumbled.

Matos also said investors can use this time to get into trends that are becoming more important and here to stay, such as demand for energy independence and supply chain solutions.

He anticipates the current holding pattern among investors to last until the middle of next year, when markets have a better grasp of how interest rates will stabilize and get “some breathing space.”

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