World's rich take punt on stocks, emerging markets

Managers of money for the world's rich are planning to boost investments in emerging markets, global stocks and hedge funds as these asset classes, once deemed risky, become more acceptable amid the developed world's woes, research showed.

A report on asset allocation among wealth managers by consultancy Scorpio Partnership found 84% of the senior investment professionals surveyed expect to increase bets on markets in the Asia Pacific region in the next 12 months.

Other emerging markets are also popular, with one third saying they plan to boost allocations to both Latin America and the Middle East and North Africa.

The report also found 40% of wealth managers planning to buy further into stocks and 31% expecting to boost allocations to alternative investments such as hedge funds.

"These are complex markets and any strategy that delivers above inflation has got to be a good thing for clients," said Catherine Tillotson, managing partner at Scorpio.

She added rich investors remain aware that emerging markets and equities still carry risk and can be volatile and appear to be using alternative investments to hedge the risk.

The research also found 41% of investors are cutting exposure to fixed income while cash allocations are either on hold or declining.

The research, carried out between April and June this year, surveyed professionals at 22 international wealth management firms, managing USD 5.7 trillion in assets for their rich clients.