Fri, Dec 06, 2019 - Page 12 News List

Rich investors turn cautious: survey

By Kao Shih-ching  /  Staff reporter

Taiwan’s wealthiest investors seem to be more conservative about the economy next year, with 77 percent choosing to increase cash holdings compared with the Asian average of 63 percent, a UBS Group AG survey showed.

The report by UBS’ global wealth management unit surveyed 3,400 of its wealthiest investors, with each owning more than US$1 million in assets, in 13 markets from August to October to assess their views on the future.

With 79 percent of Taiwanese respondents expecting more volatility in the financial market next year, 81 percent said that investing would be more challenging compared with five years ago, higher than the Asian average of 73 percent and global average of 72 percent, the survey showed.

Taiwanese investors have the same preference for stocks and cash next year, compared with global investors who prefer stocks to cash, 64 percent of whom expecting to increase investment in stocks followed by 60 percent planning to increase cash holdings, UBS Taipei told a media briefing.

Given that on average stocks have higher risks and cash is safer but generates no returns, local investors appear to be more cautious and conservative due to economic uncertainty, the firm said.

Taiwanese investors are more concerned with geopolitical events instead of corporate fundamentals, with 76 percent citing it as the main threat to portfolio returns next year, compared with the Asian average of 64 percent, Asia-Pacific client strategy office director Christine Lai (賴才琪) said.

In a world that is increasingly connected, the impact of geopolitical tensions weigh on global investors, causing the majority to feel uncertain, she said.

About 48 percent of Taiwanese investors are worried a bout US-China trade tensions, the second-highest ratio among Asia’s five markets, behind only Hong Kong’s 54 percent and followed by Singapore’s 44 percent, Japan’s 42 percent and China’s 30 percent, the survey showed.

It is surprising that Chinese investors are the least worried over the trade tensions with the US, the report said, adding that Chinese respondents cited declines in Chinese stocks and global equities as bigger concerns.

About 62 percent of Taiwanese respondents expect Asia to report the fastest growth in the world, compared with the global average of 47 percent, the report said.

Meanwhile, 86 percent of Asian investors are interested in sustainable investments and 55 percent have invested in such projects, higher than the global average, it said.

Given the energy transformation in Taiwan, this result is not that surprising and local investors are expected to continue investing in green projects, Lai said.

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