Shinhan Asset Management Publishes '2023 Fund Market Outlook' Report

[Asia Economy Reporter Kwon Jae-hee] Shinhan Asset Management announced on the 15th that it has published the '2023 Fund Market Outlook' report.

Shinhan Asset Management has been publishing the fund market outlook report for four consecutive years since 2019.

The feature of this report is that it includes an analysis of four issues affecting the fund market in an environment of rising interest rates and economic slowdown.

The report is composed of the 2022 trends, 2023 outlook, and 2023 ESG trends.

Song Tae-heon, Senior Deputy Head of the Product Strategy Center at Shinhan Asset Management, said, "Next year's economic phase will see continued economic slowdown and high inflation, and unless the economy falls into a recession with negative growth, the timing of monetary easing will be delayed and the pace will be gradual," adding, "Asset allocation focused on safe assets due to rising interest rates will continue until the first half of the year."

Senior Deputy Song said, "In a rising interest rate environment, stock investment is suitable as a systematic investment plan that can manage the average purchase price, considering that stock prices have fallen significantly from their peak," and predicted, "The differentiation of fundamentals among companies will deepen in a high interest rate environment."

He also suggested, "Attention should be paid to bond-type stocks that maintain steady capital expenditures and high return on equity (ROE), continuously increasing net asset value."

He also made recommendations regarding changes in pension products. Senior Deputy Song said, "The target date of the 2025 product, which has the largest assets under management among target date funds (TDF), is approaching in three years," and forecasted, "Regular distribution products that distribute income generated monthly will lead the retirement pension market following ETFs."

Regarding ESG investment, Senior Deputy Song stated, "Although the growth rate continuously slowed in 2022, the net inflow trend was maintained, and considering that funds outside ESG continued to experience outflows, it is premature to see this as a decline of the ESG theme itself," diagnosing, "ESG is in a growing pain stage as it moves into the implementation phase, where various stakeholders conflict in reality."

Nevertheless, he presented potential by saying, "Despite many controversies, issues related to carbon neutrality and emissions have been upgraded to a concrete level through the establishment of standards and regulations."

This content was produced with the assistance of AI translation services.