Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

Smart Beta: wealth managers recover appetite for EM risk

Smart Beta: wealth managers recover appetite for EM risk

Wealth managers moved heavily back into emerging market (EM) equities in the first quarter in one of the biggest single quarter-on-quarter moves in the three-year history of the Wealth Manager’s allocation survey.

Analysis of the data followed BlackRock numbers showing EM ETF redemptions slowed from $4.7 billion in February to $1.8 billion in March, turning positive in the second half of the month.

 

While net EM exposure – calculated by subtracting the number of respondents either neutral or underweight from those reporting an overweight – remained below zero, the move was significant.

The move from -55.5% to -14.3% net overweight was the third largest quarterly move in the history of the survey, following the bull capitulations within Japanese and European equities that occurred in Q3 last year (see chart).

European equity remains by the far the single biggest positive conviction call for UK wealth managers within the last three years with a 42% net overweight at the beginning of Q2.

‘Micro cap UK/Europe, and EM equity should be the big surprises,’ of 2014, said Alan Steel, founder and director of Alan Steel Asset Management.

Alastair George, founder and director of Hasley, was more measured, saying he expected emerging market equities to record ‘acceptable but not extraordinary progress’.

Overall, readers remained modestly risk-on, reporting equity risk exposure of 6.21, on a scale of one to 10 where 10 is the greatest. 

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Sam Vecht: the best opportunities in frontier markets

Sam Vecht: the best opportunities in frontier markets

Blackrock's Vecht evaluates frontier markets and explains where he sees the opportunities

Play Where A-rated Pattullo is finding the best bond opportunities

Where A-rated Pattullo is finding the best bond opportunities

Henderson Global Investors head of retail fixed income explains how he is managing his fund against the surprise current monetary policy divergence.

1 Comment Play Taxicab Tenner: Allianz Global Investors' AA-rated Simon Gergel

Taxicab Tenner: Allianz Global Investors' AA-rated Simon Gergel

Our much anticpated new series is here! We hand a black cab driver a tenner and grill the manager of the 125-year Merchants trust until the meter runs out.    

Your Business: Cover Star Club

Profile: meet the duo at the heart of Hargreave Hale's succession plan

Profile: meet the duo at the heart of Hargreave Hale's succession plan

For the first time in the company's history a non-Hargreave is now at the head of the north west broker and asset manager

Wealth Manager on Twitter