Equities lagging as most attractive asset class, Camradata

Institutional investors have only partially backed their own predictions for equities becoming the most attractive asset class for this year, according to the Q4 2012 fund flows report published by Camradata.

At the end of December, the market outlook survey indicated that investors saw absorbing the biggest in-flows this year as markets performed strongly.

Emerging Market Equity, Emerging Market Debt and High Yield Bonds were all slated to attract the biggest growth. Overall, equity fell by £9.5bn, a 1.2%, while bonds increased by £5.5bn, an increase of 0.9%.

Based on data drawn from 5,000 institutional investment products on the Camradata Live asset manager database, Global and UK Equity outflows in the quarter of -£9.5bn were countered by inflows into Emerging Market Equity of £3.9bn.

Multi-Asset Diversified Growth class, while not in the top three, was also given a positive forecast and investors pushed up assets by £5.9bn, a 7.5 per cent increase over the quarter. Over the full year, this represents a rise in assets under management of 40 per cent.

And property held firm with positive performance of 4.2% over the quarter although very little change in assets with -£0.1bn net outflow (-2.8 per cent).

Steve Butler, founder and managing partner said: “The continuing boost to bond holdings shows investors remain cautious about volatile market conditions and multi-asset holdings are a further indication of prudent investment behaviour. However, some are taking on more risk by entering emerging markets possibly at the expense of global and UK funds in search of return. Our findings suggest improved performance could be a factor.”

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