Perception A: Equities correction is on the way

Perception A: Equities correction is on the way


Professional investors including pension funds, insurance asset managers, family offices and wealth managers are united in the view that a stock market correction is coming in the next 12 months, new research from Managing Partners Group (MPG), the international asset management company, shows.

The only debate in the study with institutional investors and wealth managers holding assets of €107 billion under management was over the timing and scale of the correction.

The research by MPG, which runs the Melius Fixed Income Fund, found 31% expect a correction within six months while 55% predict it will come within six to nine months and 14% within nine to 12 months. 

More than half (53%) predict the size of the sell-off will be 7.5% or higher with nearly two out of five (36%) believing it will be between 5% and 7.5%. Just over one in 10 (11%) believe the correction when it comes will be between 3% and 5%.

Private equity and investment grade fixed income assets are seen as the asset classes which will see the biggest percentage increase in inflows as a result of a correction followed by hedge funds and real estate.

Government fixed income is seen as attracting the fifth highest percentage of inflows as a result followed by renewables and Life Settlements which rank above money markets, non-investment grade fixed income and alternative credit.