Seven out of ten institutional investors expect a global equity market correction of more than 10% within 18 months, according to research.
A survey of 54 institutional investors by asset management company, Managing Partners Group, found that nearly half expect a correction within a year and nearly a third expect one of up to 30%.
Only 12% of those surveyed do not expect a correction at all.
The findings of the survey reflect research that investors worldwide are steeling themselves for the emergence of asset bubbles and market corrections.
One fifth of those who have already adjusted their portfolios in anticipation of a correction have raised exposure to asset-backed securities.
The most likely reason for a slump is a run on equities sparked by fears they are overpriced (37%); other reasons cited include a ‘black swan’ event, a geopolitical crisis such as North Korea, a rate hike, the end of quantitative easing and Western governments’ indebtedness.
Jeremy Leach, chief executive officer, Managing Partners Group, said: “Equities are looking highly valued on both sides of the Atlantic and it looks as though the market is just looking for an excuse to correct.”
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