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Asian investors put strong returns down to luck

Added 5th March 2015

Nearly half of Asian investors were pleased with their 2014 returns, which many credited to pure luck, according to a survey by Manulife.

Asian investors put strong returns down to luck
Of the investors satisfied with their returns, in Indonesia 54% cited pure luck as the reason for desirable performance. The figure was 42% in the Philippines and 38% in Japan.
"Relying on luck is typically a highly risky investment strategy," said Michael Dommermuth, Manulife Asset Management's newly-appointed head of wealth and asset management in Asia.
"After several years of relative calm in many global markets, uncertainty over interest rates, geopolitical tension, slower economic growth in China and the prospect of continued recession in the eurozone mean that renewed volatility is likely to continue in 2015. Luck will usually do little to insulate investors from the degree of market risk implied by these market forces."
The exceptions were the Chinese. In China, only 11% cited luck as a factor in performance.
Similarly, investors in Taiwan (54%), Hong Kong (41%) and Singapore (39%) said portfolio diversification was a major reason for their positive views of their investment performance. 

Japanese underinvested 

Looking at Asia investors as a whole, the study found that 49% were pleased with their 2014 returns.
By country, the survey also found that the investors most pleased with their 2014 performance were Indonesian (81%) and Filipino (76%).
By comparison, the least satisfied were the Japanese (31%).
The two main causes of investor dissatisfaction region-wide were unexpected market events that impacted returns (32%) and being insufficiently invested (32%). 
In Japan, almost half (49%) of investors wished they had invested more. 
"It's not surprising that investors in Japan were displeased with their investment returns given the low interest-rate environment and high allocation to cash," Dommermuth said. 

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