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Fund Managers seek certainty in bonds
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Equity markets may have substantially recovered over the last two quarters, but fund managers are showing a greater preference for bonds, according to new research released by HSBC.
The HSBC quarterly Fund Managers Survey released this week has found that 56 per cent of the fund managers polled hold a positive view about bonds in the fourth quarter, up from 30 per cent in the third quarter.
It said 71 per cent of respondents were bullish about emerging markets and high yield bonds (up from 43 per cent in the previous quarter) and that 57 held an overweight view about European bonds.
By contrast, it said that fund managers were less optimistic about equities as an investment class, with 33 per cent of respondents overweight in the fourth quarter (down from 50 per cent in the third quarter).
It said that 57 per cent of fund managers remained bullish about Greater China equities (down from 75 per cent in the previous quarter) and that 22 per cent were positive about North American equities compared with 18 per cent in the third quarter.
Commenting on the research, HSBC head of Global Investments in Australia Charles Genocchio said the low interest rate environment had diminished appetite for cash as investors sought stable growth in what were still volatile market conditions.
“While equities will continue to provide growth opportunities, investors are less likely to expect the returns they enjoyed from the sharp rebound in global markets in mid-year,” he said.
AUTHOR
Mike Taylor
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