Fund managers worldwide optimistic

Fund managers around the globe hold a generally optimistic outlook on the future, predicting that markets in most regions will begin to recover in 2009, according to a survey released today by Watson Wyatt Worldwide Inc. According to Watson Wyatt's Global Survey of Investment and Economic Expectations, fund managers predicted a 6.7% return on global equities in 2009. The Reigate, England-based consulting firm polled 104 fund managers from firms in more than seven countries in October and November. Collectively, the respondents manage over $10 trillion in assets. The managers hold bullish views on returns from public equities, investment-grade bonds, high-yield bonds and emerging markets over the next five years. However, they are bearish on returns from hedge funds, government bonds, money market funds and real estate. In terms of macroeconomic forecasts, the managers project that the U.S. housing market will bottom out and begin to recover in the third quarter of this year. They believe crude oil prices will reverse their current downward trend and rise to around $60 a barrel this year. The top concerns worrying fund managers over the long haul — the next 10-20 years —are the potential for inadequate retirement income for large segments of the population and increased regulation costs. Thirty-nine percent of the respondents come from the United States, 20% from Canada, 15% from England, 7% from Japan, 6% from Australia, 5% from the Euro Zone, 4% from Asia and 4% from other countries.