13/02/2004

Investors look east for 2004 says Deutsche survey

Investment into Asia has been predicted to grow by US$23.6bn over the next six months while US assets drop US$34.2bn, according to a Deutsche Bank survey.

Deutsche Bank's Alternative Investment Survey questioned 322 institutions with over US$380bn of assets, and for the second year running their attentions are shifting away from the US.

And the Asian market is also shown as larger than previous estimates placed it, with reasonable estimates placing it as high as US$70bn.

Most industry experts give the size of the Asian market currently in the region of US$40bn, with most Asian money still flowing out of the region into the US.

European and global hedge funds were predicted to see more modest growth with US$7.4bn flowing into global funds and just US$3.2bn into Europe.

Average hedge fund allocations are on the increase and investors surveyed said their typical allocation will be in excess of US$20m.

And despite the poor performance of long/short strategies during 2003 they still comprised the most popular strategy in the survey with 54% of investors planning to increase allocations during 2004.

Event driven and global macro continued to be popular with over 40% of investors looking to ramp up investment.

Arbitrage strategies attracted less interest, while short bias funds were the least popular with just 42% looking to make any allocation at all during 2004.