In a world increasingly on tenterhooks about perceived threats, the Trump administration represents the biggest potential global risk in 2017, according to 44% of participants in the recent Cayman Alternative Investment Summit in Grand Cayman.
Far fewer of some 200 alternative investment decision makers and thinkers who participated in the survey were worried about other risks: cybersecurity, 25%; China, 14%; European elections, 13%; and Brexit, 4%.
Prime Minister Theresa May’s government has announced that Britain would start the two-year Brexit negotiation process on March 29.
“This next year will be unlike anything the alternative investment industry has ever faced,” Chris Duggan, director of the not-for-profit CAIS and vice president of community development for event sponsor Dart Enterprises, said in a statement.
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“With rapid technological changes and major geopolitical shifts around every corner, the industry must show that it can chart a path through what promises to be choppy waters.”
Eighty-five percent of survey respondents said the alternative investment industry would grow assets over the next five years.
Forty-six percent predicted that the number of funds would shrink over that period, while 39% said there would be more funds. Only 8% believed that both industry assets and funds would dwindle, and 7% foresaw fewer assets but more funds in the future.
“Although the challenges abound, there is strong enthusiasm among both investors and fund managers that, while still evolving, the industry will only continue to grow,” KPMG’s head of alternative investments, Tony Cowell, said in the statement.
Fifty-one percent of survey participants chose a victory by Marine Le Pen in the French presidential election as the next event most likely to upset global markets. However, a recent analysis by The Economist gave Le Pen a less than 5% chance of final victory in the two-round election.