NEW YORK, Oct. 30, 2019 /PRNewswire/ -- J.P. Morgan
Asset Management released the 2019 Global Liquidity PeerView
Survey, revealing that even as the market outlook continues to
evolve, demand for money market funds is still strong, adoption of
treasury management systems continues to rise, and more investors
are incorporating ESG criteria to screen investments. The 2019
Global Liquidity PeerView Survey features responses from 346 CIOs,
treasurers and other senior cash investors around the world,
representing an approximate combined cash balance of USD
$1 trillion.
"The changing global economic environment presents investors
with many new challenges, from slowing growth, rising trade
tensions, and falling interest rates," said Paula Stibbe, Global Head of Liquidity Sales,
J.P. Morgan Asset Management. "This year's PeerView results suggest
that in this environment, demand for money market funds remains
strong, and investors with short-term fixed income portfolios are
increasingly looking at areas such as ESG screening and treasury
management systems when evaluating their cash investment
strategy."
Four key themes were identified in the PeerView survey:
- Demand for money market funds (MMFs) is still strong:
MMFs remain the most permissible investment (in 92% of investment
policies), followed by bank obligations (62% of policies) and U.S.
Treasuries (60%). Most survey respondents (75%) plan to maintain
their stable NAV MMFs, based on the market outlook for the coming
year.
- Environmental, social and governance (ESG) investments on
the rise: Investors are increasingly turning to
responsible investing, using ESG criteria to screen investments.
19% of respondents globally are doing so now, and an additional 25%
are likely to start within the next two years.
- Adoption of treasury management systems is increasing:
The percentage of investors surveyed using such systems is now 61%.
The features used most are cash management and treasury accounting
(98%), investments and debt management (67%) and FX and interest
rate risk management (50%). Asia
Pacific (APAC) investors are more likely to develop in-house
systems (43%) than use third parties; in the U.S., only 12% and in
EMEA 11% developed their systems in-house.
- Investors are eyeing rising political risk: Rising
political risk tops the list of investment challenges, with 67% of
respondents expressing concern about the U.S.-China trade war and Brexit.
The survey also highlighted several key themes across
Europe and Asia-Pacific:
- Europe: The search for
yield and return
Term deposits continue to be the most
popular investment solution to avoid negative interest rates in
EUR- and GBP-denominated investments (62%), followed by ultra-short
duration bond funds (23%).
- Asia Pacific: Regulatory
change weighing heavily
After political risk, 55% of APAC
respondents cite regulatory change their top investment challenge.
22% cite rising credit and default risk in China as a concern—far more than peers in
other regions. APAC investors review their investment policies more
frequently (66% at least annually) than respondents elsewhere.
J.P. Morgan Asset Management's PeerViewSM is a
program that provides a unique opportunity for firms to compare
their cash investment practices to those of their peers globally,
allowing clients to evaluate variances and opportunities in cash
investment policies and practices. Each respondent receives a
customized report that compares their responses to those of their
peer groups by region, cash balance and industry.
Please view the full J.P. Morgan Global Liquidity Investment
PeerViewSM 2019 findings here.
About J.P. Morgan Global Liquidity
J.P. Morgan Asset
Management – Global Liquidity is the largest global provider of
institutional short-term fixed income solutions, with $667.5 billion in assets under management as of
September 30, 2019. The dedicated
global team of liquidity professionals, with over 30 years of money
market experience through all market cycles, works with clients to
build effective short-term fixed income solutions using rigorous
credit and risk management combined with access to J.P. Morgan
Global Liquidity's global resources and
expertise. www.jpmgloballiquidity.com
About J.P. Morgan Asset Management
J.P. Morgan Asset
Management, with assets under management of $1.9
trillion (as of September 30, 2019), is a global leader
in investment management. J.P. Morgan Asset Management's clients
include institutions, retail investors and high net worth
individuals in every major market throughout the world. J.P. Morgan
Asset Management offers global investment management in equities,
fixed income, real estate, hedge funds, private equity and
liquidity. J.P. Morgan Asset Management is the marketing name for
the asset management businesses of JPMorgan Chase & Co.
(NYSE: JPM), and its affiliates worldwide.
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SOURCE J.P. Morgan Asset Management