Cambridge Business Association
In a Tough Market, Investors Seek New Ways to Create Value
Article

In a Tough Market, Investors Seek New Ways to Create Value

Julien Ghesquieres, Jeffrey Kotzen, Tim Nolan, Frank Plaschke and Hady Farag
Boston Consulting Group, 2016
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Editorial Rating

7

Qualities

  • Analytical
  • Overview

Recommendation

A 2016 Boston Consulting Group (BCG) survey of portfolio managers and investment analysts reveals a number of trends. Bearish sentiment is on the rise. Expectations for total returns are modest, investor appetite for dividends and cash payouts has hit its limits, and a desire to see companies use cash to enhance value is growing. getAbstract recommends this short but insightful report to investors and corporate executives seeking a glimpse into how institutional investors view markets and the investment climate.

Summary

According to a survey of more than 700 portfolio managers and investment analysts, a rise in global market volatility is driving bearish behaviors among investors. Four major trends emerged from the BCG survey:

  1. Bearish sentiment vaulted about 70% from 2015 to 2016 – Some 32% of survey participants were “bearish” or “extremely bearish” about equity market prospects, in contrast to 19% in 2015. Almost three-quarters of those surveyed who reported a pessimistic view cited China’s slow economic growth as their main reason for concern. About 40% of all...

About the Authors

Julien Ghesquieres et al. are professionals with the Boston Consulting Group.

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