Returns from equity investment will remain higher than other asset classes this year, though wild swings in stock markets are expected to continue amid global uncertainties, says an asset management company.
Capital inflows prompted by the quantitative easing by the Bank of Japan and the European Central Bank will propel emerging markets including the Thai bourse, said Smith Banomyong, president of SCB Asset Management (SCBAM).
The impact is expected to overshadow the US Federal Reserve's previous quantitative easing, he said.
Mr Smith said the fragile global economy would keep interest rates low and bonds would probably give low returns.
The Thai stock market still has upside gains but divergence factors are likely to keep the market moving sideways, he said.
Uncertainties over Greece's debt problem, potential delays to Thai government spending, tepid exports and weak domestic consumption are sapping risk appetite.
SCB Securities has forecast the SET index will reach 1,800 points this year.
Potential growth sectors include construction and tourism as a result of public investment in infrastructure projects and an increase in tourists following the end of last year's political turmoil.
"Analysts have become more optimistic on the Thai stock market but listed companies' earnings are supposed to grow to lend support. However, some analysts are revising downwards their SET index target following the weaker-than-expected GDP and exports," Mr Smith said.
Given that stocks are swinging widely, the investment duration of trigger funds this year is likely to be shortened to around six months from 12 months on average last year. However, returns from trigger funds could decline to 5-6% from 6-10% last year, he said.
The mutual fund arm of Siam Commercial Bank plans to launch about six equity trigger funds in the first half.
SCBAM also plans to launch foreign investment funds that focus on countries benefiting from the oil price slump such as India and other emerging markets.
It is also considering the launch of infrastructure funds and real estate investment trusts.