INTERNATIONAL. The Middle-East is an attractive place to invest in what is currently a difficult financial market environment, said John Lomax, Global Emerging Markets Equity Strategist, HSBC, speaking at the recently held HSBC Wealth Management seminar on ‘Investment Opportunities within Emerging Markets’.“Within the global emerging markets universe, HSBC will maintain its focus on Middle East markets which continue to offer a particularly attractive risk-return opportunity. Infrastructure spend in these markets is a growth catalyst along with real estate and banking sectors seeing increased gains.”“In the UAE, expansion and extension of global cities focused on business services and tourism are seen as key drivers,” continued Lomax.
The HSBC wealth management seminar was held for the bank’s Premier customers, with an aim to build awareness about investing in emerging markets like India, China, Russia, Latin America and the Middle East.
Lomax elaborated: “Lack of historical data, political instability and regulations have typically kept investors who are keen on emerging markets away from Gulf equity markets. They have felt more comfortable to look towards more established emerging economies like India and China. This need not be the case. Our analysis shows that the Gulf equity markets will perform a good risk-return trade-off.
“The environment of prolonged low US rates and the weak US Dollar is strongly positive for GCC equities. The paradox of one of the strongest parts of the world economy pegging its exchange rate to one of the weakest will both force down GCC interest rates and keep alive the debate about possible currency revaluation.”
“The confidence we have in the regional business and the potential it offers means we will continue to recommend the GCC markets. The move is underwritten by the success of our HSBC Amanah GCC Equity Fund and HSBC BRIC Fund,” concluded Lomax.
Ishrat M Kiyani, Regional Head of Wealth Management, HSBC said: “Emerging markets have been one of the hot topics for the past five years. We have witnessed the price of oil, commodities and food products sky rocket, the equity markets in the United States and Europe free fall, and thus investors are now pouring their money into high growth developing economies.”
“This GCC segment of our customer base has liquid investments between US$100,000 and US$4 million. Our experts are clearly showing them that our Wealth Management products are best of breed and will offer healthy medium to long-term returns. For investment in the region, we offer customers structured products, mutual funds as well as HSBC Amanah Investments that invest in a regional portfolio of shariah-compliant equities. Expected capital appreciation and returns on these products are much higher than options available currently in more mature markets like the US and Europe.
HSBC’s wealth management portfolio offers extensive opportunites to investors looking to grow their money in emerging markets. These include the MFS Emerging Markets Debt Fund, HSBC Indian Equity Fund and HSBC Chinese Equity Fund.