Despite market turbulence and growing inflation, a survey of Portfolio Management Association of Canada (PMAC) members finds that professional investors have “bedrock confidence” in the financial future of equities.
The survey polled CEOs of Canadian investment companies. Findings show that respondents believe inflation will rise slightly, but meaningfully, over the next 10 years to 2.8%. This is 1% higher than the actual rate for the previous 10 years.
Over the next decade, respondent project that global equities will earn 7.8% (up from 3.6%) based on the MSCI World Index. They believe emerging marketing equities will return 9.1%. This is on par with the 11.9% actual return of the previous 10 years based on the MSCI Emerging Markets Index.
PMAC respondents continue to believe in the value of Canadian equities, saying they will provide a steady 7.4% return over 10 years, down slightly from the 9.8% recorded by the S&P TSX Composite Index for the previous decade.
“The opinions expressed in this select audit of Canada’s best and brightest professional investors represent a courageous vote of confidence in the future of equity investing,” said PMAC President Katie Walmsley. “All investors should draw on these directional insights in making their asset allocation choices and consider the impact of higher inflation on their portfolios when making investment decisions.”