Growing interest for alternative investments in EMs

Fund managers and investors plan to increase their involvement in emerging markets over the next five years.

Almost half (46%) of investors plan to increase their allocations in China and India while 30% will do so in Africa.

Fund managers will increase allocations in emerging Asia, China, India, and Africa; with 46% agreeing that these markets will offer the best opportunities in 2023, although just 23% believe that is the currently the case.

The industry report by Preqin shows that the increased interest by fund managers follows the lead of investors in increasing their EM allocations.

“We expect the whole of the alternative assets industry to grow in the next five years, but the industry will look very different to what it is now,” said Amy Bensted, head of data products at Preqin. “With the market seeing capital concentration and consolidation, fund managers and investors will have to diversify away from North America and Europe to stand out and find opportunity. This is why emerging markets will shine and why we’ve already seen growing interest in these regions.”