Nearly 80 percent of local fund managers recommend a conservative investment strategy for the rest of the year, with portfolios likely to generate zero to modest returns, a survey conducted by JPMorgan Asset Management Taiwan (摩根富林明投信) showed.
“It is better to take a defensive approach as markets will remain volatile because of downside risks related to Europe’s debt problems,” company vice president Alex Chio (邱亮士) said.
About 77 percent of domestic fund managers suggest increasing holdings in investment tools with fixed incomes and cutting risky assets, the survey showed. About 12 percent adopted the opposite view, while 10 percent advised equal holdings.
The survey’s outcome corresponds with the TAIEX’s weak performance of late. The main index shed 2.5 percent this week amid concerns that major technology firms may revise down earnings figures in investors’ conferences later this month.
China’s second-quarter GDP growth of 7.6 percent, the lowest in three years, deepened unease, JPMorgan Taiwan said in a separate statement yesterday.
Most fund managers lent support to bond funds targeting high- yield, emerging market and US bonds, the survey said.
Bond funds are more resistant to market volatility and pay regular dividend incomes, making them popular among domestic investors, the fund house said.
Despite weak sentiment, 84 percent of the fund managers expect financial investments to turn modest profits in the coming six months, the survey said.
Almost 71 percent of the fund managers estimate the returns would fall between zero percent and 10 percent, while 12 percent expect returns to hit 20 percent, the survey said. Only 11 percent said investors might incur losses.