Third of sovereign funds plan to cut equity holdings, cite trade war fear | ZAWYA MENA Edition

Third of sovereign funds plan to cut equity holdings, cite trade war fear | ZAWYA MENA Edition:

Over a third of sovereign investors plan to cut their equity exposure over the next three years after a strong run in 2017, citing trade wars, geopolitics and high valuations as headwinds to performance, a study by asset manager Invesco showed. The annual report, which is based on interviews with 126 sovereign investors and central bank reserve managers with $17 trillion in assets, found equities had overtaken bonds to become the biggest asset class in portfolios, averaging 33 percent. This is up from 29 percent in 2017. Nearly half of sovereign investors are now incrementally or materially overweight equities, but while 40 percent said they were happy with the status quo, 35 percent plan to reduce their equity exposure over the medium term, Invesco noted.