Investors in the Asian region are continuing to hold a positive outlook despite softening commodity prices, according to results of the State Street Investor Confidence Index.
The confidence of Asian investors increased to 99.7 from 95.2 for November 2006.
“Looking regionally, Asian investors continued to forge ahead, with confidence in that region recording its eighth consecutive increase,” State Street associates director Paul O’Connell said.
Globally investor confidence increased by 0.3, to 83.2 from October’s revised reading of 82.9.
In other regions the confidence of North American institutional investors fell slightly from 93.2 to 92.5, while the confidence of European investors fell from 95.5 to 89.1.
“Moderating global growth expectations, Fed patience and a further easing of commodity prices have combined to leave investors with balanced perceptions of risk,” said originator of the index and Harvard University professor Ken Froot.
“European investors, however, were less sanguine, and their appetite for global risky assets declined, albeit from near-record high levels,” Froot said.
The index measures investor confidence on a quantitative basis, analysing buying and selling patterns of institutional investors.
The index is based on financial theory that assigns precise meaning to changes in investor risk sentiment, or the willingness of investors to hold proportionally more or less of their portfolio in equities.
The more of their portfolio that institutional investors are willing to devote to equities, the greater their risk appetite or confidence.
