Volatility poses the greatest risk to portfolios, suggests a recent study of fund selectors in Asia. The survey, conducted by global asset manager Invesco, canvassed the views of 441 fund selectors across 28 countries. Inflation, interest rates and volatility were cited as the top three portfolio risks by all respondents, but whereas inflation was the leading risk globally (70%), among the Asian fund selectors, volatility was the top risk (65%), while only 51% cited inflation. There were also some differences in the views of recession among Asian fund selectors compared to their global peers. While 70% of global selectors see recession as inevitable, only 56% of Asian respondents hold the same view. However, 67% of Asia respondents believe that the market is underestimating how long a recession might last – much higher than 53% of global respondents. In terms of asset class, the survey found that 63% of allocators in Asia plan to increase their investment in government bonds, compared to 51% globally. In addition, 60% of Asian allocators also plan to increase their investments in alternatives due to increased market risks. ©2023 funds global asia