67% of institutional investors expect increased allocation to commodities

Sixty-seven per cent of institutional investors expect an increase in the level of allocation to commodities in 2021, according to research by NTree International.

Research of 150 European institutional investors and wealth managers with combined assets under management of $292.8bn, also found that 32 per cent expect the level of allocation to remain the same as in 2020. NTree International carried out the survey on behalf of investment manager, China Post Global.

When asked about the investment prospects for a range of commodities, the most positive outlook was for gold (73 per cent), followed by natural gas (70 per cent) and crude oil (62 per cent).

The research also highlighted the most important features of commodities as part of an investment portfolio, with 68 per cent of investors citing vaccine optimism and hopes of an economic recovery this year fuelling gains in commodity prices, followed by the protection they provide portfolios with insurance against inflation (66 per cent), and the strong diversification benefits they provide (61 per cent).

Other less important factors cited included the fact that, historically, many commodities are currently generationally cheap (58 per cent) and the strong recent growth/price appreciation of commodities (55 per cent).

Commenting, NTree CEO, Timothy Harvey, said: “Our research shows the growing role for commodities in investment portfolios, thanks to their hedging and diversification characteristics. Many, particularly metals, have also delivered strong growth over recent years.”

    Share Story:

Recent Stories

How the US’s robust securities law can benefit European investors
Over recent years several financial scandals have shocked investors, such as the Danske Bank money laundering case. When a scandal like this occurs, investor returns suffer, which is why many seek redress. Many European investors seek to recover assets lost as a result of securities fraud through U.S. courts, with their robust securities laws.

In this podcast, Jeremy Lieberman, Managing Partner at Pomerantz LLP, talks to European Pensions Editor, Natalie Tuck, about how European investors can use U.S. courts to recover assets lost to securities fraud and the challenges facing investors seeking compensation.

Podcast: Opportunities in Chinese equities
China was the first country to be impacted by the coronavirus outbreak, which lead to its economy plummeting. Since then, however, the country has managed to keep outbreaks of the virus under control, and is experiencing a V-shaped recovery with many areas returning to normal.

In this podcast, David Choa CFA, Head of Greater China Equities at BNP Paribas Asset Management talks to European Pensions Editor, Natalie Tuck, about China, its position within the global economy and the potential institutional investor opportunities within Chinese equities.
Mitigating risk
BNP Paribas Asset Management’s head of pension solutions, Julien Halfon, discusses equity hedging with Laura Blows

Europe’s pensions challenges
Francesca Fabrizi meets Matti Leppälä, Secretary General and CEO of PensionsEurope, to discuss the key aims and objectives of the association today.