Top 5 Asset Management trends for 2010

Written by admin on May 11th, 2011

Asset management has always been known to be close to people who belong to the finance domain. The recent event of sub-prime crisis and its ensuing effects has resulted in people being extremely cautious about their assets and investment of their assets. Safeguarding the assets then became an important point of thinking.

With the world slowly recovering from the sub-prime effect, it is time for us to look into the latest asset management trends. Economic developments in many countries have resulted in these trends to be in place.

Here are the top 5 asset management trends for 2010

Weak global banking will encourage private credit – All leading banks across the globe took a beating while the sub-prime crisis was at its peak. Experts believe that banks would need some time to recover from the aftermath of the event. The willingness of leading banks to lend is no longer there, but private lending institutions with rates lower than that of banks, are already seen making a big march. Will they win?
Developing countries will outpace advanced countries in growth rate – IMF estimates that in 2010, advanced countries would grow at about 1.5%, while developing countries like India and China would grow at about 5% thereabouts. Clearly, this points to a favorite destination for investors to invest in assets.’
The Damocles’ Sword of inflation and deflation will continue to dictate people’s investment decisions – Economies reeling under a consistent sprout of inflation is now an old story, which now has been replaced with deflation. The threat of sustained deflation has gone down steadily in most economies, but investors seem to be extremely cautious about a possible relapse of inflation. Deflation is now, a no-guarantee word, especially if governments cannot promise the need of financial institutions to get fresh funds.
Dynamic Asset Allocation seems to be the way forward – Traditionally, Strategic asset allocation has been known as the tool for asset investment, which also factors in long-term equilibrium. All that will change now, what with Dynamic Asset Allocation being able to exploit long term equilibrium, as well as deliver short term gains.
Hedge funds remain a mystery – Hedge funds have been taking an absolute battering in the last some years. Fund managers continue to promote these funds in lure of higher commissions, but the investors are turning out to be extremely cautious about these funds. They have started seeking more transparency, directionality in these funds, if they really wish to consider investing in them.

These 5 asset management trends clearly underline the way forward for asset allocation and asset management by various financial houses. It must be said here that the investors’ mindset hasn’t changed much, even after the sub-prime fallout. One thing is for sure though – Today, the investor wants clear directions and concise information.

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Leave a Reply