Survey shows growth in fund managers using alternatives

A new poll from Reuters has shown that UK fund managers increased their exposure to alternative investment vehicles during November.

The survey found that allocations to alternatives grew from 9.7 per cent in October to 11.1 per cent last month, while conventional investments such as equities recorded a slight decline.

According to the news agency, many fund managers believe that alternative assets are set to outperform equities and bonds in 2010, while alternatives such as commodities will be used as a hedge against inflation.

’The amount of stimulus provided may start to manifest in higher inflation and thus real assets such as gold could have a very good 2010,’ Chris Paine of Henderson Global Investors commented.

He also said that equities are likely to continue to perform well, but with ’a lot of volatility’, if the economic recovery continues.

Last month, it emerged that the production of gold coins by the Royal Mint more than quadrupled in the third quarter due to a surge in demand for the precious metal from investors.
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