Hong Kong investors: what, where and when?
Hong Kongers have been investing in a wide range of complex investment instruments, across many markets for decades. Today, North American markets are at the centre of their global outlook (with 56% of investors focused there), narrowly eclipsing Asian markets (at 54%) and relegating other markets in Europe, Africa and Latin America to niche roles. This regional allocation looks set to continue, with growth in America-bound investments set to outpace those into other regions – making US Equities the single mainstay of the Hong Kong investor’s portfolio outside of Hong Kong.
Yet whilst the market-mix looks stable, the asset allocations of Hong Kong investors is anything but that. In the face of challenging economic conditions in Hong Kong and the growing need to diversify, the typical Hong Kong investor’s portfolio is broadening rapidly into a range of new assets including fixed income (expanding at 15% year on year), futures and options (13%), currencies (13%), private equity (11%) and mutual funds (10%). The typical Hong Kong investor is evolving from Hong Kong stock picking to running a globally balanced portfolio that includes risk management tools and well-diversified exposures.
This expansion is not happening gradually. Hong Kong investors are making this transition right now (52% of investors are doing this in 2020) and so the urgent challenge