Wealthy investors are trimming their stock positions, amid anxiety around a trade war and instability in Washington.
Members of TIGER 21, an investment club for high-net-worth individuals, reduced their stock allocation to 21% from 22% during the second quarter, according to the group's quarterly report.
TIGER 21, a group of about 700 people with at least $10 million to invest, stands for The Investment Group for Enhanced Results in the 21st Century.
"They are concerned about the fact that the markets were priced to perfection; they thought they reached real highs," said Michael Sonnenfeldt, founder of TIGER 21.
"At the same time there are these looming black swans, this China situation, Russia and North Korea, the political instability in Washington," he said. "When you add them up, they've been feeling increasingly nervous."
They are also concerned about the Federal Reserve and the prospect of even lower rates.
"Members said it's one thing if they stop raising rates, but if they start lowering rates, it's a real red flag," said Sonnenfeldt.
"Many members are concerned about how the Fed has become politicized, he said.
These investors continue to maintain a 12% allocation in cash and cash equivalents, both as a defensive move and to scoop up new opportunities in the event of a downturn.
Their allocation to commodities ticked up to 1%, from zero, a move they tend to make amid periods of perceived potential instability, TIGER 21 found.
"Commodities are sometimes the canary in the coal mine," said Sonnenfeldt.
"It's a small percentage of the portfolio, but when there's a raise even from a rounding error of zero to 1%, it's still statistically significant," he said.
At the same time, these wealthy investors continue to feel optimistic about real estate.
TIGER 21 members have stepped up their investments in real estate for the first time in three quarters. That asset class now accounts for 28% of their holdings, up from 26% in the first quarter.
Stocks aren't the only area where wealthy investors are pulling back their exposure.
Members of TIGER 21 cut their allocation to hedge funds, and that asset class accounts for 4% of their holdings, down from 5% in the first quarter.
They've also dialed down their holdings in private equity. They now hold 24% of their investible assets in that space, down a percentage point from the prior quarter.
Fixed income holdings continue to hold steady at 9%, according to TIGER 21.
CNBC's John Schoen contributed to this report.