Crimean Troubles Worry Investors

Mar 18 2014 | 11:08am ET

Russia today moved formally to annex the Crimea—and hedge fund managers are worried.

Bank of America Merrill Lynch’s March Fund Manager Survey shows 81% fear geopolitical risk. The poll was taken as matters between the Ukraine and Russia continued to deteriorate this month, culminating on Sunday with the Crimean referendum to leave the Ukraine and join Russia, and Russian President Vladimir Putin’s signing of an annexation treaty today. The conflict has battered Russian and European stocks, and the U.S. and European Union leaders have promised increasing sanctions against Russia.

Fund managers’ stock holdings have dropped to a 15-month low, according to the BofA survey, and have also cut leverage. The number of investors identifying geopolitical crisis as the chief tail risk more than doubled, from 12% last month to 27% in March.

“Responding at a point of growing tension in Ukraine, 81% of investors said they see geopolitical risk posing a threat to financial markets stability—more than four times the reading one month ago,” BofA’s Michael Hartnett said.


In Depth

Q&A: Schroders’ Forest Discusses Multi-Asset Investments On Eve Of U.S. Launch

Jul 17 2014 | 8:05am ET

Global investment manager Schroders has $446 billion in assets under management, $...

Lifestyle

Einhorns Busts At WSOP, Finishes In 173rd

Jul 15 2014 | 10:48am ET

Greenlight Capital founder David Einhorn’s World Series of Poker won’t end at...

Guest Contributor

Common Risk Parity Misperceptions

Jul 16 2014 | 11:02am ET

Over the past few years, risk parity has become a component of most investors’...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note