An informal survey of the participants showed that 86% respondents in both financial hubs felt positive or very positive on emerging market equities and 94% felt the same about emerging market debt.
While the participants were generally largely bullish on US equities and global economy, they were less so on their domestic equity markets. In particular, 41% of Singapore-based respondents were bearish on Singaporean equities.
FSA forum participants’ 24-month outlook
Over the next five years, more than 42% of Hong Kong-based respondents saw the biggest opportunities for equity returns coming from the US. Curiously, only 4% of Singaporeans felt the same, while indicating they would place their long-term bets on India, China and Indonesia instead.
FSA forum participants’ five-year view on equity returns
Participants in the FSA forums included fund selectors from wealth management and private banking sectors in Asia’s two major financial hubs. While the focus of the event was long-term investing, 29% of Hong Kong participants and 21% of those based in Singapore indicated that for their clients, “long term” means one year or less, underscoring the need for more thorough investor education.
Almost 67% of Hong Kong-based respondents and 50% of those based in Singapore expected global inflation to increase gradually to long-term averages, while 25% of Singaporeans (and only 7% of Hong Kongers) expect a further prolonged period of low interest rates. In both cities, approximately 13% said they expected inflation to soar.
EM concerns
When asked about concerns about investing in emerging markets, approximately 36% of participants in the Singapore forum named corporate governance, and the same number pointed to politics as their main concern. A further 18% said they were concerned about growing global protectionism.
Liquidity in emerging market debt was also a concern for 48% of Hong Kong-based and 65% of Singapore-based participants.
Rising interest rates and company defaults dominated the concerns of respondents when asked about global high yield investing.
FSA Forum participants’ concerns with global high yield
