Fund managers globally have a generally optimistic outlook for 2009, predicting that markets in most regions will start their recovery this year. According to a recent Watson Wyatt survey, managers further predict that the recovery period of markets will be lengthy and that the influence of pension and sovereign funds will increase while the influence of investment banks and hedge funds will fall significantly.
Key Details
The survey’s main findings include:
* Fund managers expect that their institutional clients will choose more conservative investment strategies and will prioritize risk control as the main area for improvement in their governance.
* Top concerns for the next 10-20 years include inadequate retirement income from defined contribution plans and greater regulation, leading to higher costs for everyone.
* Managers hold bullish views of returns on public equities, investment-grade bonds, high-yield bonds and emerging markets over the next five years. However, they remain fairly bearish on hedge funds, government bonds, money market and real estate returns, and are neutral on private equities and currencies.
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