In a recent survey conducted by Schroders, it has been revealed that investors in the Asia Pacific region are increasingly optimistic about their investment strategies, particularly in global equities and private equity. This trend comes as they navigate the complexities of deglobalisation, disruption, and decarbonisation in the current economic landscape.

The Schroders Global Investor Insights Survey indicates that approximately 61% of investors in Asia Pacific are either confident or very confident about achieving their return expectations over the next one to two years. This sentiment mirrors that of their global counterparts, suggesting a shared optimism in the face of potential economic challenges.

As part of their investment strategy, 51% of these investors plan to raise their allocations to global equities within the next two years. This figure aligns with the global average, highlighting a broad consensus on the attractiveness of international markets. However, the survey also indicates a stronger inclination among Asia Pacific investors to increase their exposure to country-level equities, with 40% expressing this intention—a notable 9% higher than the global average.

Investors in the region are particularly focused on thematic investment opportunities, with 41% believing that equities are well-positioned to capitalize on disruptive technologies. This is followed by 36% who see potential in deglobalisation and 26% in decarbonisation. These figures underscore a strategic shift towards sectors that are expected to thrive amid ongoing global changes.

Private market investments are also gaining traction, with a significant 82% of Asia Pacific investors either currently investing in or planning to invest in private markets over the next one to two years. This interest is comparable to global trends, indicating a robust appetite for alternative investments. The primary motivations for this allocation include enhanced portfolio diversification and the prospect of achieving higher returns.

In fact, more than half of the respondents—53%—expressed their intention to increase allocations to private equity within the next year, which is consistent with global investor sentiment. Additionally, 48% are looking to invest more in renewable infrastructure equity, while 47% are considering private debt as part of their investment strategy.

When it comes to capturing opportunities in private markets, 24% of Asia Pacific investors believe these markets will be best suited for investing in disruptive technologies. This is followed by 20% who see potential in deglobalisation and 29% in decarbonisation. These insights reveal a strategic focus on sectors that are poised for growth in the evolving economic environment.

The survey, which included nearly 800 investors from the Asia Pacific region out of approximately 3,000 globally, highlights the prevailing concerns among investors. The primary worries identified were the impact of central bank policies (71%), high interest rates (70%), and the possibility of an economic downturn (68%). These concerns reflect a broader view among investors that macroeconomic conditions will significantly influence investment performance in the coming year.

Johanna Kyrklund, Chief Investment Officer at Schroders, emphasized the importance of focusing on investment fundamentals rather than being swayed by sensational news headlines. She noted that while economic activity remains generally positive and inflation trends are improving, major central banks are beginning to cut interest rates, which could support equity valuations moving forward.

As the Asia Pacific region continues to adapt to the shifting economic landscape, the findings from the Schroders survey provide valuable insights into the evolving investment strategies and priorities of regional investors. With a clear focus on global equities, private markets, and thematic opportunities, investors are positioning themselves to navigate the challenges and seize the opportunities that lie ahead.