Global market risk is more worrying than credit risk for stock markets this year, says Krungthai Asset Management (KTAM).
Global factors remain the key risk that could rattle stock market sentiment, said chief investment officer Veera Vutthikongsirigool, citing turmoil in the Middle East and Ukraine and the threat posed by the jihadist group known as Islamic State.
Other concerns include the US Federal Reserve's potential rate reversal and the global economic slowdown.
Market risk from those factors is increasing, Mr Veera said, while credit risk — last year's biggest problem — is abating.
"But returns from stock markets remain higher than from bond markets because a US rate hike will lower returns from bonds," he said.
Despite the recent pullback in the Thai stock market, Mr Veera sees upside potential for investors who focus on small- and mid-cap stocks.
Other bourses offering attractive returns are those in China, Japan and Europe, while Wall Street faces a market correction after rising sharply over the past few years.
Infrastructure and property funds are alternative investments providing returns of 6-8% a year.
KTAM plans to launch an Electricity Generating Authority of Thailand infrastructure fund worth 20 billion baht by the second quarter.
Nattachart Mekmasin, research manager at Trinity Securities, said the SET index in March would move in a range of 1,540 to 1,620.
Positive factors include the European Central Bank's bond-buying scheme and a potential rate cut by the Bank of Thailand's Monetary Policy Committee at the March 11 meeting.
The Fed's Open Market Committee meeting on March 17 and 18 could sway stock markets if the word "patient" is dropped from the panel's statement.
In its previous statement, the Fed said it would remain patient and not rush to begin normalising interest rates.