22/08/2011
By Matt Ritchie
The trend of increasing appetite for investing in emerging markets has continued, according to Baring Asset Management.
New research from Barings has revealed that 12% of investors are seeking exposure to emerging markets over the next 12 months, up from 9% last year.
The amount of people seeking investment opportunities in emerging markets has steadily increased year-on-year since 2009, Barings said. Data from the Investment Management Association indicates funds under management in emerging markets stood at £6.2 billion in May 2009, £9.5 billion in May last year, and £13.1 billion in May this year.
In the short term, investors would most likely chose an emerging markets portfolio that covers all emerging markets (9%) and the Brazil, Russia, India and China (BRIC) region (9%).
However, over the long term, Barings said people prefer to spread their investments with 11% choosing all global emerging markets, 7% choosing BRICs, and 6% picking Asia.
Head of UK retail distribution at Barings Rod Aldridge said the company expects the trend to continue given the “enormous potential” in emerging markets compared to their developed counterparts.
“Clearly investors are seeing the benefit of diversifying their investments as they opt to invest across a number of regions within the emerging markets; which is important given each region varies hugely in terms of the risk/reward profile it offers. Investing across global emerging markets as a whole is particularly favoured over the short and long term.
“Investors should always remember that emerging markets can be very volatile and investing in them may not be suitable for everyone. If in any doubt, investors should consult a professional adviser.”
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