Individual investors in Asia are mostly concerned about volatility, a slow economic recovery, inflation and low interest rates as they look ahead at the macro-economic themes set to shape investment trends in 2021, according to the annual Natixis Investment Managers’ global survey of individual investors.
Many also reported suffering an emotional toll during the pandemic.
Although seven in ten said that they feel fortunate, almost six in ten said they are stressed about their financial security – as many as seven in ten in Korea – compared with 49% globally. Half of those in Asia also say they are fearful, rather than confident, and vulnerable financially versus four in ten globally.
Almost one in five Asian investors (18% in Asia versus 16.9% globally) said they experienced a setback to their financial security as a result of the pandemic. Overall, one-third of Asian investors (31% Asia versus 25.2% globally) lost household income during the pandemic.
Natixis Investment Managers’ 2021 Global Individual Investor Survey was conducted by CoreData Research in February and March 2021. In Asia, Natixis surveyed 3200 investors with a minimum of $100,000 in investable assets.
Head not heart
Individuals also learned some important investment lessons last year. A third of Asian investors cited the need to avoid emotional investment decisions compared with 29% worldwide.
Given that the pandemic produced both the swiftest market downturn and the swiftest recovery on record, investors could have learned the lesson one of two ways: those who panicked early and pulled assets may have paid the price by missing out on the double-digit returns, while those who stayed put may have been rewarded for their patience.
“The challenge for many in Asia will be to ensure that they do not let emotions, up or down, get the better of them,” said Fabrice Chemouny, head of Asia Pacific, Natixis Investment Managers.
Given investor desire for safety and distaste for market turbulence, the sudden spikes in volatility seen in March 2020 taught many that they need to better understand the risks of their investments.
That lesson resonated most strongly with Asian investors in Singapore (41%), Taiwan (40%), China (36%), Thailand (35%) and Hong Kong (33%), according to the survey.
Looking at markets in 2021, volatility (47%) and a slow economic recovery (43%) are top of mind risk factors for Asian investors, compared with the global response of 40% and 39% respectively. Inflation (30%) and low interest rates (27%) also factor into their outlook, similar to worldwide at 31% and 27% respectively.
Yet, coming out of the pandemic and into recovery, Asia’s investors see big opportunities to grow their assets and to anticipate even greater results in the years ahead, according to Natixis.
