A SURVEY commissioned by Principal Global Investors on Tuesday showed investors are becoming more cautious, and are looking to mitigate unrewarded risk.
"The financial crisis taught investors a number of lessons, but a key takeaway for all was greater caution. Investors have become more risk-aware and more agile than ever before. In 2013, the quest for yield was evident. In 2014, as caution has become more embedded in the investor psyche, investors have recalibrated their return expectations," said Andrea Muller, CEO of Principal Global Investors Asia, in a press statement.
The survey showed retail investors are accepting lower yield, while high net worth individuals have shifted from a blanket focus on alpha - a common measure of performance that takes risk adjustments into account - to focus on risk mitigation, the survey said. The emphasis on real estate investment is particularly stark for the latter group: investor interest shot to 61 per cent this year, up from 37 per cent in 2012.
Principal Global Investors is the institutional asset management arm of the Principal Financial Group. It managed US$328.2 billion of assets as at June 30, 2014.