The iGlobal navers si are preparing to increase positions in securities a fixed income and liquidity in view of theEconomic uncertainty and the accructed volatility of the markets in the next 12 months. This is what emerges from a study conducted by Pgim.
Investors focus on fixed income
This conclusion is part of the last study Pgim’s gatekeeper Pulse®, who examined the allocation plans, the investment attitudes and preferences of Managers of 210 Gatekeemper (Fondi selectors) at large global financial institutions in Europe (including the United Kingdom) and in Asia, all with a heritage under management of at least 1 billion dollars. This is the Sesto Studio di Pgim aimed at identifying the most important issues for those responsible for the selection of funds.
The public fixed income continues to attract global operators: the 37% plan to increase allocations in this asset Class during the cycle of expected rates cuts, while 14% plan to reduce positions. A similar trend is observed in private credit, with 22% net of investors who plan to increase exposure.
The increase of aLlocation on the bond market It is in line with the expectations of yielding of gatekeeper for next year: 43% require that the public fixed income will generate higher returns compared to the previous 12 -month period, against 20% that are expected lower returns. In private credit, 34% include higher returns in the next period, against 24% that are expected more modest returns.
Matt Shafer, Head of International Intermediary Distribution of Pgim, recognizes the continuous appeal of the fixed income for investors, in a context characterized by duties, volatility of the equity markets and slowdown in economic growth that feed the uncertainty.
“In a market characterized by political confusion and turbulence, Customers are moving towards the fixed income both to obtain stable returns and to protect themselves from the risks of discount, “he says Matt Shafer, hEad of International Intermediary Distribution of Pgim. “With the evolution of market dynamics, the multisectoral strategies that offer the flexibility necessary to switch from one bond segment to another based on the relative value are recording a particularly strong question”.
high risks stimulate demand for liquidity and alternative solutions
With the markets that have been oscillating between propensity and risk aversion in recent months, it is not surprising that the attitude of gatekeeper towards risk hiring remains conflicting. Compared to the previous 12 months, 32% of gatekeetper requires to increase their exposure to risk in the period to come, while 40% involve a reduction. In Asia, both percentages are 37%.
As for the main ones risk factors, geopolitical risks, fears of recession and high inflation The main concerns cited by investors in Europe and Asia were. Continuous episodes of turbulence on the markets are also expected: 83% of gatekeeper globally expect greater volatility of returns over the next year. In an uncertain macroeconomic context, 39% of the gatekeeper intends to increase allocations in liquidity/tools of the monetary market in the next 12 months, while 20% require a reduction in liquidity positions.
There application for alternative investments, Like private equity and private credit, it remains robust despite a slight drop on an annual basis. 22% net of interviewees plan to increase investments in private credit and 19% net requires to strengthen positions in private equity. Fund Selector expressed a preference for access to private markets through direct investments and co -investigations, perhaps suggesting a desire for control in the current context of caution. Common vehicles are in second place in terms of ease of access to investments in private markets.
In the private credit sector58% of the fund selector It provides that there will continue to be opportunities in private credit “Middle-Market”, given that large banks are limiting loans to medium-sized companies. However, half of the interviewees think that this segment is destined to record lower spreads, because competition to fill the void becomes more intense.
Another asset class Alternative destined to observe an increase in demand is that of infrastructures. In the next 12 months, 45% of gatekeemper plan to increase allocations in infrastructure, while only 7% are inclined to reduce positions. With a net increase of 38%, the infrastructures are at the top of the positive expectations of the gatekeeper in terms of allocations for the period to come.
Transformative technology strength for equity
Globally, GLInvestors are less optimistic on actions than fixed income. Only 26% of gatekeetper require that the returns of the listed and private share markets will be higher than those of the last 12 months, while a much higher percentage (45% for listed markets and 40% for private ones) are expected lower returns. Given the importance of US actions for global markets, the weakest prospects for growth and profits are probably the main factor behind the caution of the gatekeeper.
This uncertainty He has led to conflicting intentions regarding the allocation of assets by Gatekeeper: 34% plan to increase positions in listed shares, against 27% which provides for a decrease. For gatekeeper who intend to increase allocations in shares, global share strategies remain the main choice. However, almost two thirds provide for regional fragmentation in equity performance due to differences in monetary policies between the different economies. By showing less alignment, the gatekeeper are divided on the fact that the titles of small and medium -sized enterprises will be able to fill the performance gap compared to the category of the Large Cap.
Although in recent months the equity markets have passed from optimism to uncertainty, Shafer provides that the interest of investors pEr the equity titles will remain strong, In particular in the sectors related to transformative technologies.
The role of the AI
“We continue to believe that Generative IA will redesign The global economy will transform the business models and improve the consumer experience, “says Matt Shafer, Head of International Intermediary Distribution of Pgim. “From the point of view of investments, despite the fears that the current cycle of technological investments led by the AI can reach the peak before expected, we provide that the next significant phase of the growth of the AI, from which investors will be able to benefit, will derive from a wave of applications based on the AI ”.
As for the real estate sectormore than half of the gatekeeper does not provide for positioning changes in the next 12 months. There is a significant propensity for the internal market for 20% of investors who could increase positions, where European gatekeepers favor developed Europe and Asian ones prefer to develop Asia.
Alessandro Asii, Country Head of Italy Intermediary Distribution at Pgim summarized: “The last Gatekeeper Pulse study clearly reflects the pressures and tensions that investors face today. Gatekeeper recognize the need to manage high risks, but are not arguing: they are simply adapting to what will probably be a prolonged period of uncertainty.
“We are witnessing a more selective approach in all asset class, with a growing demand for stable income solutions such as fixed income and infrastructure, together with a cautious but constant interest in private markets and innovative equity issues. The report also highlights a growing emphasis on risk management and flexibility, characteristics that meet the favor of today’s customers “.
