What Fund Managers Are Predicting for 2016

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What Fund Managers Are Predicting for 2016

Daniel Cross Jan 11, 2016

Economic Expectations Vary Depending on Region and Sector

Mid-cap stocks are the preference of most fund managers this year with energy, transportation, construction and financials leading the way. Further, 65% of investors said high-quality earnings stocks would outperform low-quality earnings ones, and fund managers seem to agree with a greater weight in stronger blue chip companies.

Overall risk-taking by investors in the market is falling with cash holdings growing to an average of 5.2% in portfolio weight. 29% of asset allocators are underweight on commodities – up from 23% back in November, suggesting a further separation from commodities and commodity-based trades.

Nearly half of all fund managers surveyed (43%), expect China’s economy to weaken even more in the next 12 months, while weighted GDP growth expectations fell from 5.9% in November to 5.5%. Additionally, the U.S. is underweighted by the majority of fund managers, while European and Japanese markets are slowly being overweighted. For emerging markets, India is being looked at as the biggest upside surprise for the year.

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