A missed opportunity?

Investors are taking a positive view on offshore markets with foreign unit trusts recording their first net inflows since the September 2001 quarter.

Latest statistics released today by the Association of Collective Investments (ACI) show that there were close to R500m net inflows into foreign currency denominated unit trusts in the December quarter.

This marks a strong reversal of a negative trend which began two years ago amid poor market performance and volatility. The inflow follows two successive quarters of outflows totaling nearly R3bn.

ACI CE Colin Woodin says the improvement in investor sentiment reflects the better performance of offshore equity markets in the second half of last year.

"Most offshore analysts are predicting further growth in equities during this US election year and have recommended investors raise equity levels in portfolios to take advantage of the expected continued bull trend."

Total offshore fund assets rose by R1bn during the quarter to R45.5bn with the number of funds increasing to 328 (320). This brings total assets of all collective investments registered in South Africa to over R275bn. The foreign currency denominated funds represent 16.5%.