27/06/2011
By Ilonka Oudenampsen
Chinese equities are seen as having the strongest growth potential over the next 12 months by 52% of European investors, followed by global equities (45%), European equities (42%), gold (39%) and commodities (34%), according to a recent pan-European investor sentiment survey by Schroders.
The survey showed that 44% ranked their own country as the least risky area to invest in, revealing a clear bias among investors to their home country when it comes to regional risk. Western Europe came second at 29%, followed by Asia at 21%, while Africa and the Middle East were ranked the most risky (61% and 54% respectively).
Schroders questioned 2,200 high net worth investors across ten European countries, which showed that future investment intentions may contradict current views towards risk and asset classes.
Despite 79% currently investing in their own country, only 33% ranked it as having the best prospects for growth over the next 12 months. In particular, 95% and 84% of respondents from the UK and Spain respectively invest domestically at present, but only around 25% ranked their market as having the best investment prospects over the next 12 months.
Similarly, 38% and 22% of UK and Spanish respondents are investing in Western Europe and North America, but only 12% and 5% ranked the regions as having the best investment prospects over the next 12 months.
Executive vice chairman of Schroders Massimo Tosato said: “The global economic recovery is facing a number of headwinds in 2011 and the investment outlook remains highly uncertain. Our research highlights an interesting contradiction between high net worth investor sentiment and potential investment intentions.
"However, it supports the fact that investors are undoubtedly seeking opportunities that give them access to growth stories like China. Diversification continues to play an important role following the global credit crisis and therefore investors see global equities as a way to take advantage of a range of recovery stories.”
Other stories you may find of interest:
Models indicate Euro breakup would bring 40% drop in equities
If the eurozone were to break up, the most favourable option would be for Greece to leave, while a complete breakup would have the most severe consequences, according to SunGard
European products April
Gartmore has launched its UK Absolute Return Fund, the latest in its absolute return range
Investors see both growth and risks in financial markets
A majority of institutional investors and corporate executives (86%) believe there are significant opportunities for growth in financial markets, but 58% think that there are major downside risks preventing them from taking advantage of those opportunities, according to a global survey by the Economist Intelligence Unit
