UK – Standard Life Investments has increased its exposure to Asian equities at the expense of cash, despite anticipating that the equity markets will remain volatile.
The move follows other recent moves by the company to invest more heavily in UK, US and European equities and is a result of the global equity markets having recovered the losses sustained in the aftermath of the September 11 terrorist attacks in New York.
Investment in the equity markets has also been stimulated by lower interest rates, says Standard Life, and the low interest rate environment is helping investors shrug off their risk aversion policies in search of better returns.
Standard Life also points out that equity markets have a tendency to perform better between November and May than the other half of the year, though this cannot be ensured.
Says Keith Skeoch, chief investment officer at Standard Life: “Monetary conditions have been improving in recent weeks, most visibly when there was a trio of half-point cuts in interest rates by leading central banks. Equity markets are likely to rally well before any turn in economic activity.”