It’s a Mad World: How Fund Managers Can Keep Investors On Top of Global Opportunity

by on Aug 19, 2013

Recent headlines offer a flurry of both opportunities and challenges for global investors. In Asia, the re-election of Prime Minister Shinzo Abe and theglobal-investments1 Liberal Democratic Party’s consolidation of control of the Diet means that voters have said “Yes” to his Three Arrows policy. The Wall Street Journal reports that Nissan Motor Co.’s profits grew by 14% in the first quarter, benefiting from a weaker Yen. Could this be a sign that Mr. Abe’s policies are beginning to lift the nation out of the economic stagnation that has gripped the island nation for a decade?

Japanese Prime Minister Shinzo Abe at the Diet session in Tokyo on Aug. 2, 2013
Japanese Prime Minister Shinzo Abe at the Diet session in Tokyo on Aug. 2, 2013
Elsewhere in Asia, slowing growth in China has apparently spooked many market participants. Barron’srecently noted that the PMI has signaled contraction for three straight months in the nation, and the Journalrecently detailed the financial woes of a $91 billion, incomplete and indebted Caofeidian industrial zone near Tangshan City. Amid weakening figures, investors may have reason to feel skittish about the immediate growth prospects of Chinese assets.

Europe has consistently made the headlines as the region appears to alternate from crisis to shoots of green and back to crisis. Plagued by high unemployment and divergence between core nations and heavily indebted peripheral members, the region is likely to face headwinds for some time.

Closing Thoughts
While investors might want to bury their head in the sand and continue to invest in familiar domestic companies, it is up to asset management firms to explain why in today’s globalized world, international funds remain an important portfolio component. Companies should take the initiative to educate investors about the benefits – and risks – of global and international funds, while promoting their products. A fund company’s message can be bolstered by insightful thought leadership that cuts through the chatter and gets to the core of investing issues.

Corporate Insight’s July 2013 Mutual Fund Monitor monthly report looks at International Investing, offering in-depth competitive analysis of how 17 leading asset management firms are presenting global investment opportunities to retail investors. For more information on the report and our Mutual Fund Monitor research service, please contact Jeff Latzer, head of mutual fund research, at jlatzer@corporateinsight.com.