More than a quarter of surveyed money managers and asset owners describe their outlooks for 2020 as bearish, a survey from State Street Corp. shows.
Of the 101 asset owners and money managers surveyed in November, 26% say they are somewhat bearish about the coming calendar year, while 6% say they are very bearish.
Thirty-eight percent of respondents said they are somewhat bullish, and 18% said they are very bullish, while 12% felt neutral about the outlook in 2020.
Respondents from larger institutions, however, were more bullish than smaller institutions.
For those institutions with between $100 billion and $500 billion in assets, 66% of respondents were either somewhat or very bullish, 55% of respondents with more than $500 billion in assets were somewhat or very bullish, while only 30% of respondents with less than $100 billion in assets were somewhat or very bullish.
The survey also asked respondents about the more supportive regulatory stance the SEC has recently taken regarding semitransparent active exchange-traded funds.
Forty-seven percent of respondents said those ETFs will play a significant role in their firms' portfolio strategies, and 46% of respondents said those types of products will help stem the ongoing flow of assets to passive strategies from active strategies.
When asked whether their institutions outsource trading, 62% said they outsource some or all of their trading, while 14% said they handle all their trading in-house. Twenty-four percent of respondents said the question was not applicable to their institution.
Also, 38% of respondents said they plan to increase their allocations to digital assets in 2020, while 45% plan to maintain the same allocations. Among firms with $500 billion or more in assets, 69% said they plan to increase their allocations to digital assets in 2020, compared to 34% of firms with between $100 billion and $500 billion in assets and 33% of firms with below $100 billion in assets.
"The survey supports what we have anecdotally believed for some time — the future is bright for active equity ETFs, as well as firms seeking to outsource trading activities and increase allocations to digital assets-related investments," said Nadine Chakar, global head of State Street's markets business unit, in a news release on survey results. "It's an exciting time for technology and innovation in the industry, and ultimately investors will benefit from new technologies and a wider range of choices for constructing portfolios."
