Expert Investor asked at several conferences across Europe last autumn whether equity markets would experience another correction, after the China-induced upheaval in September, in the following couple of months. The answers fund selectors gave varied wildly from country to country.
Naive Danes, edgy Swedes
The Belgians and Danes couldn’t really have been more wrong. The vast majority of them said, in late September and early October respectively, that they didn’t expect another equity market correction to occur any time soon. However, the MSCI World tumbled over 15% from 1 December to 20 January, and by even more in euro terms.
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Norwegian fund buyers were undecided when asked in November. Just under half of them deemed another market slump likely. But there are two nations whose fund buyers can be credited with predicting the market correction: the Dutch and, especially, the Swedes all saw it coming.
A phenomenal 73% of Swedish fund buyers present at the Expert Investor Sweden forum in late September believed that a new market correction was on the cards. The majority of delegates at the Expert Investor Netherlands forum in Amsterdam, held around the same time, were also right: 58% predicted January’s market falls. While the polls mentioned in this article were anonymous, one fund selector dared to go public with his view of an upcoming market correction. Joachim Klement, a member of Expert Investor’s editorial panel, predicted in September last year that a market correction was on the cards for 2016.
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We asked fund buyers in Munich another question at the end of October, namely whether equity markets were likely to go up by 10% or more in the next three months. The buoyant Bavarians overwhelmingly answered ‘yes’ to this question. However, the MSCI World was down 8% three months after they were polled…
