In its fifth year canvassing investors across the globe, the 2015 Franklin Templeton Global Investor Sentiment Survey polled over 11,500 investors in 23 countries across the Americas, Africa, Asia Pacific and Europe.
In one of the broadest surveys of its kind, respondents shared their views and current attitudes towards investing and their expectations for 2015 and the decade ahead.
Investors globally identified their top three investing concerns as being the state of the global economy (38 per cent), government fiscal policy (32 per cent)and the Eurozone debt crisis (32 per cent). The global economy is the biggest concern, particularly among US/Canadian (48 per cent) and APAC (40 per cent) investors. Latin American investors are most concerned with government fiscal policy and inflation at 39 per cent and 37 per cent respectively, while the Eurozone debt crisis is the top concern in Europe at 48 per cent.
Within Europe, the Eurozone debt is the top investment concern for German investors (61 per cent named it as their top concern). It is also the top concern for UK investors (58 per cent), French investors (49 per cent) and Swedish investors (36 per cent). For Spanish investors, their top concern is unemployment (43 per cent) and the Eurozone debt crisis ranks third at 40 per cent. For Italians, the top concern is also unemployment (45 per cent)and the Eurozone debt crisis ranks third (32 per cent).
David Zahn, head of European Fixed Income at Franklin Templeton Investments, says: “The world seems to be moving on from the Eurozone debt crisis while Europe remains firmly divided on the issue. The ECB QE program, combined with the firewalls put in place, reduces the likelihood of a Eurozone debt crisis but the survey findings indicate that investors in the core countries of the Eurozone have not taken this on board. However, investors in peripheral countries Spain and Italy have a different outlook. In our view, this highlights the opportunity for investors in an actively managed European fixed income portfolio to capture return through selective country allocation.”
Globally, equities are viewed to be the riskiest asset class in 2015 and over the next 10 years. 35 per cent of global investors chose equities as the riskiest asset class, followed closely by the Euro (34 per cent), and non-metal commodities (32 per cent) for 2015.
However, European investors think that the Euro currency will be the riskiest asset class in 2015 and over the next 10 years; this includes Spanish, UK, French and Swedish investors where the largest number of respondents chose the Euro as the riskiest asset class. Italian investors perceive equities to be the riskiest asset class in 2015 and over the next 10 years, closely followed by the Euro, and German investors think alternatives will be the riskiest asset class in 2015 and for the next 10 years.
“Views of what constitutes risk vary within the industry, and it’s important for investors to have a clear understanding of what risk means to them and how it impacts their portfolios,” says Jamie Hammond, managing director, Europe, Franklin Templeton Investments. “In today’s volatile, low interest rate environment, many investors are looking for actively managed investment solutions that can help reduce volatility in unpredictable markets, while seeking to provide attractive risk-adjusted returns.”