‘GET READY FOR CHINA BUBBLE BURST’
Diversify investment portfolios and identify areas that can still perform, says analyst
COUNTRIES and companies have been urged to diversify their investment portfolios in preparation for the China bubble burst.
“Whether we like it or not, the China bubble will burst. This is very normal as there will be a burst in every cycle, so it’s really nothing to fear,” said RHB Asset Management chief investment officer of fixed income Michael Chang yesterday.
“The key takeaway is to prepare and to identify areas that would still perform in the event of the bubble burst.”
Chang expects to see stronger fund inflows into the debt and fixed-income segment of emerging markets within the short to medium term, on the back of the United States Federal Reserve’s (Fed) slight pause on interest rate rise.
“The market at large has already factored in three interest rates to a collective 25 basis points rise from the Fed this year, so we are already well prepared,
“However, with this pause, we do see higher fund inflows into emerging markets, including Malaysia. The fact that the dollar has weakened over the last couple of months is also good news as this will help the volume of the fund inflows.”
Chang earlier moderated at a panel discussion on the Fourth Industrial Revolution (Industry 4.0) and emerging technologies during the Market Insights Forum 2017.
Themed “Understanding the Business of Tomorrow”, the forum focused on trending topics concerning the integration of Asia, One Belt One Road initiative, Asean Economic Community, the New World Disorder and Industry 4.0.
RHB Asset Management chief investment officer of fixed income Michael Chang (right) with (from left) Boston Consultant Group (Thailand) Ltd principal Benjamin Fingerle, Sime Darby Group strategy and corporate finance head Datuk Thomas Leong and RHB Banking Group chief operations officer Rohan Krishnalingam at a panel discussion in Kuala Lumpur yesterday.