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Preqin: Alternatives gain in emerging markets

Wednesday, October 31, 2018
Opalesque Industry Update - Alternative assets investors are increasingly globalizing their portfolios, and interest in emerging markets is growing. In the next five years, 46% of investors plan to increase investments in China and India, while 30% are planning to increase their allocations to Africa. Similarly, fund managers are increasingly looking at opportunities in emerging markets, and almost half feel that emerging markets will present the best opportunities in 2023. Emerging Asia, China, India and Africa are of particular interest, with the largest proportions of fund managers planning to increase their investments in those respective regions over the next five years.

Amy Bensted, Head of Data Products:

"We expect the whole of the alternative assets industry to grow in the next five years, but the industry will look very different to what it is now. With the market seeing capital concentration and consolidation, fund managers and investors will have to diversify away from North America and Europe to stand out and find opportunity. This is why emerging markets will shine and why we've already seen growing interest in these regions."

Key Emerging Markets Alternative Assets Facts:

Large proportions of investors plan to increase investment in emerging markets in the next five years:

  • 46% of investors plan to increase investments in China and India respectively, and 30% are increasing investments in Africa.
  • Fund managers have taken notice of increased investor interest, and although just 23% of fund managers believe emerging markets currently present the best opportunities, almost half (46%) of fund managers feel that emerging markets will present the best opportunities in 2023.
  • In keeping with this, 54% of fund managers plan to increase investments in emerging markets, while another 58% plan to increase investment in Asia-Pacific regions.
  • Specifically, 53% plan to increase investments in emerging Asia, 49% plan to increase investments in China, 46% plan to increase investments in Africa and 44% are looking to India - all in the next five years.
  • Just 11% of fund managers currently see attractive opportunities in Africa, but 26% expect to see attractive investment opportunity in the continent in 2023.

What do you think?

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