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As a
possible U.S. rate hike and June's 'Brexit' referendum come into
view, global equity allocations accounted for an average 51.0
percent of this month's portfolio, based on a survey of 13
U.S.-based global funds, a touch lower than 51.1 percent in
April.
That figure has not been lower at any point across comparable
records that began in 2007 and marks the fourth straight monthly
downgrade to this category by the survey panel so far this year.
While recommended allocations to bonds, cash and property have
remained steady, fund managers have slightly raised alternate
investments for the fourth month in a row.
U.S. stocks have fared better this month on growing evidence the
U.S. economy is on a more solid footing, which has ramped up
once again expectations that the Federal Reserve may raise rates
in the next few months.
Many investors have become more comfortable with the prospect of
higher rates, taking the view that reflects solid improvement in
the economy and should be welcomed.
Fed Governor Jerome Powell said on Thursday a rate hike may come
"fairly soon", in line with several other policymakers who have
spoken in recent days. But he added that fears about Britain
voting to leave European Union in a June 23 referendum argues in
favor of exercising caution.
Among the global bond portfolio, fund managers favored increased
exposure to investment grade debt and less to sovereign debt.
Funds also recommended cutting North American bonds, to 65.8
percent from 66.2 percent, a two-and-a-half year low for the
survey.
(Polling by Sarmista Sen and Shrutee Sarkar; Editing by Toby
Chopra)
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