The Best Money Managers show which country they will invest in !

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The Davos summit is on top of every top executive worldwide. The most rich and powerful from each country attend this high profile meet.

stock-investment-geographical

There is a little exercise that carried out during this meet – World’s top Investment Managers get together in one small room and are given mock $1 billion and half an hour to create a winning portfolio for each of the following categories.

  • pension fund
  • sovereign wealth fund
  • infrastructure fund
  • multi-family office
  • hedge fund
  • private equity fund, and a
  • real estate investment trust

This, although an experiment gives clear insight on where and which Geography these top investors are bullish on ! Here is what the outcome of this exercise was !

Note: These numbers have been directly picked up from here:

Pension Fund

Being Pensioner’s money, the group played safe and invested 65% of money in developed markets, and 35% in emerging markets. Majority of chunk from Emerging Markets went to China ! Other countries in South Asia also recd. good chunk of money !

Sovereign Wealth Fund

The biggest beneficiary for this was Norway, and the portfolio tilted on Energy investments in Developed and Emerging countries. Again here, the group was big on China, but very underweight on Japan and South Korea.

Infrastructure Fund

Now here is a big surprise, the team decided to put full $1 billion USD in India citing "chronic supply gap and high capital need".

Now you know where you should put money :)

Multi-Family Office

The money was put in quality shares, with 40% of the money going to North America, 20% to Western Europe, and 30% to Brazil, India and China (but nothing to Russia), with the rest spread around.

Hedge Fund

30% of the money went into US mortgages and high-tech firms, in China for consumer focused businesses and India  for infrastructure. Team was "cautious" on Europe and "short" (i.e. betting on a decline) on the UK economy, roubles and the yen.

Private Equity

Geographically, United States got 30%, Europe got 25% and Japan got 5%. Rest 40% was put aside for Emerging Economies (China 15%, India 15%, Russia 5%, Latin America 5%)

Real Estate Investment Trust

The team decided to go with broad geographical spread and low-risk investments,with being heavily overweight in emerging markets (50%), with 20% going to the US, 15% to the EU and another 15% to Australia.

In Conclusion:

North America was still the most preferred destination for investment, but the big winners in this experiment were India and China.

For more details and reasons behind these investments, go here:

  1. Tejas Pargi says

    It should be china, china and india.

  2. Edward Stevenson says

    Interesting piece on money management. Indeed I’ve noticed a shift in the $ volume towards Chinese stocks – particularily small caps beginning in 2009, and thus far carrying on into 2010. I released reports on a few while they were ‘hot’ via http://timelesswealth.net

    Thanks again.

  3. Chandrakant Deshmukh says

    Thanks Arun for this post. It is interesting to know about fund manager views on future investment. Besides infra, agriculture and food and supply (retail?) will be another sectors need focus from investers. Brazil and China is majorly working on this.

  4. Ankit says

    I think i should switch my country ! Cos the Indian Stock Markets seem to be Anti me.Everytime i invest, the markets decide to turn their direction #FML

    However , I am still bullish on Infra and Retail!! Unitech has reached buying levels again IMO!! A 2-3 day rally and a 80-85 is on the cards.The only stock which has given me more than decent returns on short term basis

  5. Vishal Sanjay says

    The high investment on infrastructure isn’t a surprise is it, India has great capacity and resources, but lack of capital is something which is leaving us behind. Most international infrastructure firms would see India as a great opportunity.

  6. Nikhil Ambekar says

    Yes i will surely :)

  7. Nikhil Ambekar says

    Thanks Arun, for the timely post.

    1. Arun Prabhudesai says

      kaa? Are you planning to invest :) let us also know where you are investing in…

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