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Equity funds remain ‘most researched’ in 1H

US and emerging market equity funds were the most researched asset classes by Asia-Pacific ex-Japan institutional investors, according to Evestment data.

In the first half, 18 of the top 20 most viewed funds on the firm’s research platform were focused on equities.

“With equities doing so well around the world, it’s not surprising that users are spending a lot of time viewing these strategies,” a spokesman for the firm told FSA.

“There continue to be questions about how high equity values can go, so users are likely looking at these strategies in large numbers to stay on top of market trends and keep their options open for redeploying assets if signs of a bubble appear.”

The results are similar to the most viewed funds last year, when 19 were equity funds.

US and emerging markets

This year, five US equity funds have appeared on the firm’s most viewed list, similar to FE Advisory’s ‘most searched’ funds, which suggested that more users are looking for funds investing in North America equities.

A number of wealth and asset managers this year have tilted toward US equities. Bank J Safra Sarasin, for example, prefers US equities over emerging markets and Europe. State Street Global Investors shares a similar view, in which US large cap equities get the firm’s biggest overweight relative to other asset classes for its multi-asset portfolios.

US equities, which are on the longest bull run in US market history, have outperformed the global markets this year. Year-to-date ending 7 September, the S&P 500 returned 8.66%, while the MSCI All Country World Index returned 1.85%% and the MSCI Emerging Markets Index -9.77%, according to FE data.

When compared to last year, performance was reversed, where the MSCI Emerging Markets Index returned 37.6%, outperforming both the MSCI AC World Index (24.61%) and the S&P 500 (21.83%).

However, emerging market equity funds have gathered interest among the region’s investors, who perhaps see the under-performance as a buying opportunity. Five of the funds on the most-researched list are EM products versus only one last year.

“Emerging markets continue to generate a lot of interest because the upside on returns can be so large,” the spokesman said. “However, return history can also be volatile, with emerging markets doing really well one year and less the next year.”

Top products viewed by consultants and institutional investors in Asia ex-Japan (January-July 2018)

Source: Evestment

Part of the Mark Allen Group.