Tue, May 26, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Eurozone debt crisis remains top concern of investment professionals - Barings

Wednesday, February 02, 2011

Rod Aldridge
Opalesque Industry Update - The Eurozone debt crisis is considered by investment professionals to be the most significant threat to investment growth over the next six months, with over two thirds (68%) citing it as one of the biggest Global macro-economic investment challenges, according to the Barings Investment Barometer1. Just 46% considered this a significant challenge in the last quarterly survey2, demonstrating that the Irish debt crisis and worsening situation in Portugal have renewed concern amongst the investment community for Eurozone stability.

The barometer, that explores intermediary attitudes towards the current economic environment and outlook as well as opinion towards the various asset classes (full results below), also found that concern for inflation is growing, with 32% saying that it is a significant challenge to investment growth. This up 14% on the last survey. A majority (74%) of investment professionals also say that their clients are concerned about the impact of inflation on their cash investments, and 86% say their clients have already, or plan to, reallocate cash investments to inflation protected assets. Reflecting this, cash is the least favoured asset class with 80% finding it unfavourable.

The prospect of a second banking crisis is more of a concern than it was three months ago (18% up to 30%) but much fewer are concerned about a double dip recession, with 7% considering this a threat to investment growth compared to the previous figure of 21%.

To help their clients through the current market volatility, 73% of advisers are encouraging greater diversification of assets. This is an increase on the last poll when 61% said they were doing this. Now, almost half (49%) of advisers are also recommending clients conduct more regular reviews of their investment portfolio.

Rod Aldridge, Head of UK Retail Distribution at Barings comments: “Market volatility continues to be at the forefront of investment advisers’ minds, especially with mounting concerns over the Eurozone. It is good to see that investment professionals are placing such a great focus on diversification and the regular review of their clients’ portfolio to best mitigate the risks of volatility.”

In terms of asset class favourability, emerging market equities and Asian equities (excluding Japan) remain at the top of the leader board in the ranking of investment professionals’ most favoured asset classes (with 95% favourable to emerging market equities and the same number favourable to Asian equities - excluding Japan). The barometer also shows that about two-thirds (63%) of investment professionals are encouraging investors to increase their allocation to emerging market equities and half (50%) believe investors should be increasing exposure to Asian equities.

Nearly two thirds (66%) are advising clients to decrease exposure to fixed income, more than any other asset class. This is an increase on the last survey when just over half (53%) where advising this.

Rod Aldridge comments: “It is encouraging to see that emerging market equities continue to be a most favoured asset class. We strongly believe that conditions for investing in emerging markets are attractive as they remain fairly valued with positive prospects for investment return. “

Source

kb

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Comment - Top hedge fund managers talk about how easy their jobs have gotten, BlackRock to Schroders warn of Argentina’s $20bn bond glut, The 35-year “investment supercycle” is drawing to a close, says Bill Gross, Gundlach: When the Fed starts hiking rates, 'GET OUT' of this asset class[more]

    Top hedge fund managers talk about how easy their jobs have gotten From Businessinsider.com.au: Time was, before the financial crisis hit, corporate boards treated multi-billion dollar hedge fund managers like Jehovah’s Witnesses pounding on their doors and flashing bibles. But no more.

  2. T Rowe's challenge to Dell deal may fuel critics of 'appraisal'[more]

    From Reuters.com: An increasingly popular tactic used by hedge funds and others to extract more money from buyouts could soon face a major courtroom test when a big investor in Dell Inc may argue that it should be paid a higher price for the 2013 acquisition of the PC maker. The strategy, known as "

  3. News Briefs - Ergen says LightSquared plan unfairly favors hedge funds, Why hedge fund managers make good advisory clients, I learned a lot about dad-bros after spending 4 days in Vegas with 2,000 hedge funders[more]

    Ergen says LightSquared plan unfairly favors hedge funds LightSquared Inc.’s bankruptcy plan gives hedge funds that invested in the broadband company a leg up while blocking telecommunications firms from competing with it, a fund owned by Dish Network Corp. Chairman Charles Ergen said in

  4. Opalesque Exclusive: SEC approves proposed changes to Form ADV, '40 Act - comment period to follow[more]

    Bailey McCann, Opalesque New York: Hedge funds and providers of liquid alternatives will want to pay close attention to proposed reforms approved by the SEC yesterday. The changes will require more frequent reporting, as well as a closer look into social media, liquid alternative strategies, and

  5. Opalesque Exclusive: Ovation Partners targets opportunities where few "natural lenders" participate[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Changes in financial regulations post-2008 (Dodd-Frank and Basel III) are forcing banks to significantly alter their core lending businesses. And as mid-sized

 

banner