{"id":47312,"date":"2015-12-10T00:30:00","date_gmt":"2015-12-09T23:30:00","guid":{"rendered":"http:\/\/beta.next-finance.net\/note\/institutional-investors-bullish-on-stocks-alternatives-in-2016-wary-of-global-political-tensions-natixis-survey-shows\/"},"modified":"2015-12-10T00:30:00","modified_gmt":"2015-12-09T23:30:00","slug":"institutional-investors-bullish-on-stocks-alternatives-in-2016-wary-of-global-political-tensions-natixis-survey-shows","status":"publish","type":"post","link":"http:\/\/beta.next-finance.net\/en\/note\/institutional-investors-bullish-on-stocks-alternatives-in-2016-wary-of-global-political-tensions-natixis-survey-shows\/","title":{"rendered":"Institutional investors bullish on stocks, alternatives in 2016, wary of global political tensions, Natixis Survey Shows"},"content":{"rendered":"<p>Natixis surveyed 660 institutional investors around the globe on their year-ahead market<br \/>\noutlook and asset allocation plans. Institutional investors expect stocks to be the bestperforming<br \/>\nassets in 2016, according to a survey released today by Natixis Global Asset<br \/>\nManagement. The study also found that investors believe global political tensions and changing<br \/>\ninterest rates will make markets volatile. In response, they plan to increase diversification and<br \/>\ndevote more of their portfolios to alternative assets.<\/p>\n<p>The study found:<\/p>\n<ul>\n<li> <strong>Hopes high for equities:<\/strong> Institutional investors expect equities to perform better than any other asset category next year, with global stocks outperforming both U.S. and emerging markets equities.<\/li>\n<li> <strong>Increased use of non-correlated assets:<\/strong> Over the next year, most institutional investors will maintain or raise their holdings of non-correlated assets, including 50% who will<br \/>\nincrease private equity holdings and 45% who will increase private debt, while 41% will increase<br \/>\nallocations to hedge funds and 34% will add hard assets such as real estate. The majority (56%) believes their alternative assets will perform better in 2016 than they have this year.<\/li>\n<li> <strong>Decreased use of bonds:<\/strong> On average, institutions currently allocate 28% of their portfolios to fixed income. Over the next year, 42% of institutions expect to decrease their allocation to fixed income, the largest allocation decrease of all asset classes. Just 16% plan to increase their allocation to fixed income.<\/li>\n<li> <strong>Top sources of market volatility:<\/strong> More than half of institutions (54%) predict global politics will be the No. 1 cause of market volatility next year. Investors say markets are also at risk of economic woes in China (49%), differing international monetary policies (47%) and changes in interest rates (46%).<\/li>\n<li> <strong>Uncertain performance:<\/strong> Institutional investors say market volatility is the biggest risk to their investment performance next year, followed by sluggish economic growth and monetary policy concerns.<\/li>\n<\/ul>\n<p><em>\u201cCentral bank policies, market volatility and other outside events have a big influence on<br \/>\ninstitutional investors,\u201d<\/em> said John Hailer, Head of global distribution and Chief Executive Officer<br \/>\nof Natixis Global Asset Management in the Americas and Asia. <em>\u201cThey are eager to improve their<br \/>\nincome and performance in this environment. We\u2019re seeing a surge in demand for innovative<br \/>\nstrategies that target specific needs across more diversified, complex portfolios.\u201d<\/em><\/p>\n<p><strong>Mixing active and passive management<\/strong><\/p>\n<p>The findings favor a hybrid approach to active and passive investing. The survey found<br \/>\ninstitutions are using actively managed investments to generate alpha and for exposure to noncorrelated<br \/>\nassets, while they use passively managed investments primarily for equities and to<br \/>\nminimize management fees.<\/p>\n<p>Notably, two-thirds of investors (67%) believe world economic factors and higher market<br \/>\nvolatility will favor actively managed assets over passive investments in 2016.<\/p>\n<p><strong>Changing rates? Investors juggle bonds<\/strong><\/p>\n<p>Many countries, including the United States, are on the verge of raising rates. Others are<br \/>\nholding steady or have recently cut rates. The divergence in policy is unsettling to many<br \/>\ninstitutions and could contribute to volatility next year.<\/p>\n<p>If the U.S. Federal Reserve and other central banks raise rates from their historic lows,<br \/>\ninstitutional investors are poised to make several portfolio modifications.<br \/>\nThe majority (65%) will move from longer-duration bonds to those with shorter durations. Other<br \/>\nadjustments include reducing their overall exposure to bonds (49%), raising their allocations to<br \/>\nalternative investments (47%) and using absolute return strategies (47%).<\/p>\n<p><em>\u201cIn a high volatility market context, with divergent monetary policies and global political unrest, institutional investors are increasing allocations to alternatives in a hunt for yield,&#8221;<\/em> explains Christophe Point, Managing Director of Natixis Global Asset Management Distribution for France, French-speaking Switzerland and Monaco. <em>\u201cThese strategies are a source of diversification, a critical component to building a more durable portfolio over the long term&#8221;<\/em>, concludes Christophe Point.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8211; Large investors significantly increase allocations to alternatives in hunt for yield<br \/>\n&#8211; Market volatility biggest risk to investment performance<br \/>\n&#8211; Most investors will shorten bond durations when rates rise<\/p>\n","protected":false},"author":20,"featured_media":47310,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1481],"tags":[1809,1655,1659,1657,1651,1437,1724,2091,1680],"_links":{"self":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts\/47312"}],"collection":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/users\/20"}],"replies":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/comments?post=47312"}],"version-history":[{"count":0,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts\/47312\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/media\/47310"}],"wp:attachment":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/media?parent=47312"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/categories?post=47312"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/tags?post=47312"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}