Investors should ride the wave of market uncertainty instead of shying away.
And Asia Pacific is where investors should focus on for opportunities due to its combination of emerging and developed markets, says Fidelity International in its mid-year outlook report.
“Developed markets such as Singapore and Japan are attractive due to stability, while emerging markets such as Malaysia and India present attractive growth prospects in the near future,” says Paras Anand, head of asset management, Asia-Pacific, at Fidelity.
While staying at the sidelines seems appealing, Anand says investors can profit handsomely from volatility and should be mindful of putting their money in assets seen to have low risk and volatility.
“Today’s market is driven by fear as much as it is by greed, resulting in capital preservation and not gain. People are generally after a low risk of loss and a small but smooth gain, instead of a volatile yet big gain,” he adds.
As for US-China trade war, Anand warned investors not to expect a quick resolution.
In addition, softer economic growth is forcing governments to shift from monetary to fiscal strategies like boosting infrastructure spending.