European asset managers cut their exposure to stocks in August as expectations of rate hikes in the United States pushed many to book profits while shares remained near record highs, a monthly poll shows.
A Reuters survey of 11 European chief investment officers and fund managers found the average recommended allocation to equities in balanced portfolios dropped to 45.7 percent from 49 percent a month earlier – the lowest since September 2013.
The pullback in equities benefited alternative investments, such as hedge funds, private equity and commodities. They rose to 7.2 percent from 5.6 percent. Property allocations rose to 1.7 percent from 0.5 percent.
“We decided last week, with equities actually not too far off their highs for the year, was a better time to lower our still constructive stance on equities,” said Steven Steyaert, a portfolio specialist at ING Investment Management.
Steyaert said a combination of geopolitical threats, such as the conflict in Ukraine, and mounting speculation the U.S. Federal Reserve will soon tighten monetary policy had prompted ING’s new stance on stocks.