Just over a half of those questioned (51.3%) expect a bounce-back and sentiment change on China. Approximately a quarter are either undecided or doubtful of a shift in attitude towards the country.
Despite the recent turmoil in global markets lead by China, the appetite for emerging markets remains neutral overall, Cofunds said.
The research found two fifths (42%) of advisers maintain a neutral view in the current climate, despite growth in the sector falling to its slowest pace in six years.
In fact, when asked their sentiment on the region one third of advisers (34%) felt ‘optimistic’ with just one fifth (19%) ‘pessimistic’.
Whilst China continues to dominate the headlines, ‘a significant number of advisers remain concerned’ about how China’s slowdown will impact the UK, Cofunds said.
In contrast three quarters (75%) of advisers are ‘extremely positive’ about India, noting its growth potential, and saying they expect it to be one of the world’s strongest equity markets over the next five to ten years.
“As economic conditions appear to be improving, it is interesting to see a positive trend towards the emerging market sector, however with the continued uncertainty and slowdown in growth, advisers are right to be wary of investing in Chinese funds,” said Britt Holland-Ellice, head of fund group relations at Cofunds.
“With increased demand for Japanese and European equities it will be interesting to keep a close eye on this sector over the next couple of months however, as adviser sentiment indicates, there is still continued uncertainty on overseas markets,” she added. “On that basis we conclude that new investment money is, for now, likely to stay closer to home.”
