PRIVATE EQUITY | Cesar Tordesillas, China

Fund managers optimistic on China's equities: HSBC

Global fund managers are most optimistic about China's equities, with 56% of respondents holding an overweight view in the first quarter of 2012.


According to HSBC's latest fund managers' survey, a tenth of fund managers shifted from neutral to overweight views in the first three months this year towards equities on Chinese, Hong Kong and Taiwan markets.

These were among the worst performing asset classes last year that started to turn around in the fourth quarter of 2011.

"With an attractive valuation, the equities may offer potential wealth opportunities," said Eric Fu, HSBC's head of wealth development, Hong Kong, retail banking and wealth management.

"China's recent monetary easing measures, such as cutting the reserve ratio requirement, also improved market sentiment. Investors expect further easing which will continue to support the equities market,"Fu added.

The survey, conducted during January and February, also showed fund mangers were less bearish on equities as equity markets rebounded, with 50% and 30% of respondents holding neutral and overweight views in the first quarter, up from 20% and 30% respectively in the fourth quarter of 2011.

Meanwhile, about 44% of fund managers were underweight towards cash, compared with last quarter's 22%.

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