CFA UK: Investors finding developed market equities overvalued

More investment professionals are viewing developed market equities as overvalued than at the start of the year, according to the Chartered Financial Analyst Society of the UK.

According to the CFA UK Valuations index, 55 per cent of respondents view developed market equities as overvalued whereas only 39 per cent felt this way at the start of the year. 

Only 12 per cent of respondents from the 584- strong sample of CFA-certified investment professionals see value in developed market equities – the lowest proportion on record.

Investment professionals also view government bonds and corporate bonds as overvalued, with 75 per cent and 72 per cent of respondents respectively expressing this opinion.

Emerging markets equities are the only asset class where investment professionals are finding value but this proportion is falling.

Of the sample, 50 per cent of respondents see emerging market equities as undervalued down from 59 per cent feeling this way at the beginning of the year. 

CFA UK chief executive Will Goodhart says: “In spite of serious geopolitical events, stock markets are at or close to highs. 

“However, our research indicates that investors are increasingly cautious about valuations and this may affect the way that capital is allocated over the remainder of the year.”