Fewer investors will own equities over the next decade. Why? A McKinsey Global Institute report finds that in developed economies, aging investors are moving toward balanced and income portfolios.
Low returns and high volatility have also caused a flight from equities in favour of fixed-income and alternative investments.
In emerging economies, where stock markets are more opaque and less accessible, private investors’ assets are concentrated in bank deposits.
Read: Canadian equities bounce back
Investors typically buy more equities as their countries get richer, but this won’t happen fast enough to satisfy corporate appetites.
In particular, banks need to increase equity over the next decade in order to meet new regulatory requirements.
Read: An equity shortfall on way? >
