PensionsNov 26 2015

Up to one in five consider investing in EMs

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Nearly one in five working people are likely to consider investing in emerging markets in respect of their retirement planning, according a Baring Asset Management study.

The score is the highest since 2009, and is an increase on the 17 per cent seen in 2014, the investment firm said.

The online research of 1,548 non-retired British adults also found that of those who expressed an appetite in investing in EM, 13 per cent would look to invest in a single portfolio – up from 12 per cent in 2014 and 8 per cent in 2013.

When asked about specific EMs, 8 per cent said they would likely invest in major Asian economies such as China, India and South Korea, while the same number said emerging European markets such as Poland were desirable.

One in 20 said they would likely look at the Asean region, while 4 per cent said they would likely look at frontier markets.

In addition, sentiment towards EMs appeared more positive among younger people, and 15 per cent of 18 to 24-year-olds said that they would likely consider investing in a single portfolio that covered all EMs. This is compared to eight respondents in the 55 to 64-year-old age group.

Rod Aldridge, head of EMEA, covering UK retail distribution, at Baring Asset Management, said: “The emerging markets asset class represents a significant number of countries and a significant slice of the global economy. We believe it can form an important part of a balanced, risk-adjusted investment portfolio as long as investors get proper financial advice and build a suitable portfolio for their particular requirements.

Adviser view

Iain Murray, financial adviser at Dorset-based True Potential Wealth Management, said: “There are always going to be good and bad areas when it comes to emerging markets, and that is why I like to use a fund manager who is better-placed to make these decisions.