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  • 05/04/2013

Of course, the enthusiasm for equities and property noted in previous sections may be less a rational calculation, and more a case of simply trusting the familiar. A dissection of the responses on private equity and hedge funds, two asset classes which have often not had a good press over the last few years, provides some support for this hypothesis.

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On the face of it, these asset classes appear to have relatively few admirers among the survey respondents. However, if you strip out the "don't know" responses - which were, as one would expect, widespread for both asset classes - then amongst those who had an opinion, the enthusiasm for these alternative asset classes increases. Over two-thirds of those who have an opinion believe that hedge funds will perform very or quite well over the next five years; an even higher share (76%) think this of private equity. And, even on a one-year basis, enthusiasm for private equity and hedge funds is approaching that for equities and property. Of course, a belief that an asset class will do well may not translate into actual investment if the risks perceived are substantial.