Waiting game!
MANAMA: Major sovereign wealth funds (SWFs) are holding off big investments abroad expecting markets to fall further this year, a survey showed.Some of them are focusing on investing at home to stimulate economies in the wake of a global crisis, according to the survey by Financial Dynamics International (FD).
The survey also confirmed a unanimous view that SWFs see their role as that of passive long-term investors, with no desire to behave in an activist manner towards investee companies.
In a series of one-to-one non-attributable interviews, FD interviewed senior executives from a number of leading SWFs - whose total assets accounted for well over 50 per cent of the $5 trillion worth of collective global funds currently held by the SWF asset class.
The research focused on current SWF attitudes towards valuations, investment strategies and where they see regional investment opportunities.
SWFs are broadly adopting a very cautious approach to the current market, expecting better value to materialise later during the year, according to the research.
And they see the most attractive regions for investment being Brazil, China and areas of Central America.
Western European markets are also seen as offering the most compelling value with price earnings ratios of publicly listed companies down more than 40pc from their peak.
"Our research confirms that whilst SWF are currently adopting a very cautious investment approach to world markets, they are clearly poised to re-enter the global equity markets in the not too distant future with compelling valuation propositions beginning to present themselves across North American and Western European equity markets," said FD group chief executive officer Charles Watson.
"Our research has also determined that contrary to widespread perceptions, SWFs are primarily genuine long-term passive investors who have no agenda to exercise management control or behave in an activist way."
Whilst a number of key SWF investments have been made over the last 18 months and SWFs are still interested in broadening their portfolios, the findings showed that this particular class of investor is keeping a watchful eye on global markets, waiting for the right time to make deep value investments.
business@gdn.com.bh
source: http://www.gulf-daily-news.com
The survey also confirmed a unanimous view that SWFs see their role as that of passive long-term investors, with no desire to behave in an activist manner towards investee companies.
In a series of one-to-one non-attributable interviews, FD interviewed senior executives from a number of leading SWFs - whose total assets accounted for well over 50 per cent of the $5 trillion worth of collective global funds currently held by the SWF asset class.
The research focused on current SWF attitudes towards valuations, investment strategies and where they see regional investment opportunities.
SWFs are broadly adopting a very cautious approach to the current market, expecting better value to materialise later during the year, according to the research.
And they see the most attractive regions for investment being Brazil, China and areas of Central America.
Western European markets are also seen as offering the most compelling value with price earnings ratios of publicly listed companies down more than 40pc from their peak.
"Our research confirms that whilst SWF are currently adopting a very cautious investment approach to world markets, they are clearly poised to re-enter the global equity markets in the not too distant future with compelling valuation propositions beginning to present themselves across North American and Western European equity markets," said FD group chief executive officer Charles Watson.
"Our research has also determined that contrary to widespread perceptions, SWFs are primarily genuine long-term passive investors who have no agenda to exercise management control or behave in an activist way."
Whilst a number of key SWF investments have been made over the last 18 months and SWFs are still interested in broadening their portfolios, the findings showed that this particular class of investor is keeping a watchful eye on global markets, waiting for the right time to make deep value investments.
business@gdn.com.bh
source: http://www.gulf-daily-news.com
