There can be little doubt that 2022 was a torrid year for investors. With the return of inflation, the Russian invasion of Ukraine as well as lasting impacts from the Covid pandemic all playing their part, equity and bond markets took fright.

Indeed, 2022 was notable for many things. However, it was also a year which saw retail outflows from funds coming in at the massive total of £25.7 billion. That’s according to the Investment Association as they revealed that 2022 had turned out to be the only calendar year ever to record negative fund sales to retail investors. That’s quite an
accolade – but not one we’d like to see repeated for quite some time. On page 12, we summarise the detail of the IA’s December report and also summary data for 2022.

So, in this edition of Wealth DFM Magazine, we ask whether 2023 is set to reverse this trend and see a return of investor confidence? The first quarter of 2023 has certainly been showing some encouraging signs. On page 12, we summarise the detail of the IA’s report to show that 2022 was the only calendar year ever to record negative fund sales to retail investors.

Regulatory challenges ahead

As if the tough economic climate and threat of global recession isn’t enough of a challenge in itself, the wealth management sector is facing an increasingly challenging landscape from a regulatory perspective too. On page 9, BNY Mellon Pershing’s Linda Gibson and Mike Rothwell outline some of the key regulatory challenges ahead for wealth managers.

Which sectors are investors favouring?

On page six, we look at which sectors investors are favouring in 2023. Seven distribution heads from asset managers reveal where they’re seeing strongest client demand. Spoiler alert: you won’t be surprised to see fixed income featuring heavily!

But what about China? The very abrupt end to China’s incredibly draconian Covid19 lockdown measures brought about a stark about-turn for the role of the Chinese consumer. On page 18, GAM’s Jian Shi Cortesi and Swetha Ramachandran outline the drivers and likely beneficiaries of an expected sharp resurgence in Chinese consumption in 2023.

Is the dollar set to weaken?

And finally, last but not least, Gene Frieda, Global Strategist at PIMCO, sets out why he believes the dollar is set to weaken as fears over last year’s shocks abate.

In summary, this spring edition of Wealth DFM Magazine, showcases just a small sample of the many articles which appear online every day on www.wealthdfm.com and which attract considerable attention from our wealth manager audience.

Whatever 2023 has in store for investors and wealth managers, you can be sure that Wealth DFM will be bringing you expert opinion and perspective to help shape your thinking in today’s challenging market conditions.

Sue Whitbread
Editor | Wealth DFM

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