For example, emerging market and Asia ex-Japan equities had considerably more buyers a year ago: 32%, versus just 12% and 10% planning to decrease exposure. Emerging market equities was the only equity category to deliver negative returns, both in local currency and euro terms, in 2015. The turbulence in emerging markets in the second half of the year wasn’t foreseen by all asset managers either, though they did an acceptable job in the end: about half of the fund managers who were polled got it right, predicting stock market returns between -5% and 5%.
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Asset managers beat fund selectors
So now it’s time for the Expert Investor jury to draw up the balance. Four points are to be awarded, one four each asset class discussed above. For European equities, both get a deserved point. For US equities, fund selectors were wrong, but fund managers at least got the direction right, so let’s give them half a point. For Japanese equities, asset managers made the perfect call, but most fund selectors missed the boat. When it comes to emerging market equities, fund selectors were definitely too optimistic, though they actually quickly became net sellers of EM equities in 2015. Just too bad for them that doesn’t count here. Asset managers were also slightly on the positive side, so no points for them either here.
That leaves us with a final score for equity markets outlook contest: asset managers vs. fund selectors 2.5-1. Let’s see next week whether fund selectors’ fixed income outlooks made more sense. Stay tuned!
