Investor holdings in equities likely to shrink in 2023
Allocation of equities in Indian portfolios may fall from 10.8% to 7.6% in next year; Indian investors are changing their finances worried over inflation, recession, economic uncertainty: StanChart study
image for illustrative purpose
Changing Priorities
- Gold continues to be top priority of Indian investors
- 61% respondents said they stay invested in gold
Chennai: Concerned about inflation, uncertain global economy and the threat of recession, Indian investors are making changes to their finances, said Standard Chartered's Wealth Expectancy Report 2022.
According to the report prepared by Standard Chartered Bank, Indian investors have made changes to their finances like spending less, making new decisions around their portfolios, which will prompt shifts in major asset classes.
Investors are reconsidering their holdings of equities as market volatility increases, although this asset class will remain an integral part of portfolios. Of those currently invested in equities, there is an indication that the allocation of equities in Indian portfolios to fall from 10.8 per cent to 7.6 per cent in the next year based on survey responses, Standard Chartered Bank said citing the report.
According to report, to outpace inflation, 61 per cent of global investors are looking to reduce their cash holdings, compared to 70 per cent in India. Standard Chartered predicts that global cash allocations will fall from 26 per cent in 2022 to 15 per cent in 2023, indicated by investor responses.
Nitin Chengappa, Head, Affluent, Private Bank, NRI and Deposits, India, Standard Chartered Bank said: "There has been a clear shift in the way Indian investors are managing their wealth. They are making feasible alterations in their investments to tackle inflation and spread their asset portfolio. Investors are considering to lower their assets in cash and are opting for more sustainable investments. We expect this period of flux to continue till inflation and recession worries abate."
This year, gold continues to be of high interest for Indian investors, with 61 per cent saying they have invested as a result of inflation, in addition to combat inflation in 2022, there is interest in value stocks at 60 per cent and bonds at 59 per cent, Standard Chartered report noted.
