Adviser’s appetite for emerging markets remains neutral in spite of recent economic volatility in global markets with one in two advisers expecting China in particular to recover from its slowdown, according a new study conducted by British investment platform Cofunds.
The report says that nearly 42% of advisers maintain a neutral view on emerging markets in the current climate, despite growth in the sector falling to its slowest pace in six years.
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When asked about their sentiment on the region, one third of advisers (34%) said they are optimistic and only 19% said they are pessimistic.
A considerable number of advisers expressed concern about the impact to the UK of a slowdown on the world’s second – largest economy.
Views were divided amongst advisers on China’s recovery, as nearly 51.3% anticipate a bounce back and sentiment to change.
Approximately a quarter were either undecided or doubtful of a seismic shift in attitude towards the country, the study found.
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By GlobalDataConversely, 75% of advisers said they are extremely positive about India, noting its plentiful investment growth potential.
Cofunds head of fund group relations Britt Holland – Ellice said: "As economic conditions appear to be improving, it’s interesting to see a positive trend towards the emerging market sector, however with the continued uncertainty and slowdown in growth, advisers are right to be wary of investing in Chinese funds."
She added, "With increased demand for Japanese and European equities it’ll be interesting to keep a close eye on this sector over the next couple of months however, as adviser sentiment indicates, there is still continued uncertainty on overseas markets. On that basis we conclude that new investment money is, for now, is likely to stay closer to home."
