Shift in Preferred Investment from Deposits to Bonds
What's Brewing in the Classical Investment Landscape? Adapting Strategies and Tools for Optimal Returns
Economic observer Oleg Bogdanov recently delved into the current state and preferences of investors on the classical investment market, sitting down with Aslanbek Nachaev, head of investment product sales at Private Banking and "Privilege" VTB, at the St. Petersburg International Economic Forum. Here's a breaking-down of their discussion.
Trending Market Issues and Investor Focus
- The market may have eased up slightly, but caution still permeates, particularly in the pure equity market. beefs from traditional banking goods towards fixed income and bonds are becoming increasingly popular, inviting lengthier high-yield periods.
Market Dynamics and Attention-Grabbers
- Rising interest rates and the cost of money are driving the majority of discussions among investors at the moment.
Risk Appetite Analysis
- Risk appetite has certainly increased from the previous year, with a significant surge into bond investments since the first quarter of 2025. Additionally, the queued wave of equity issuances and IPOs on the horizon should make the market even more dynamic.
Considering the Investment Horizon
- Clients now seem more inclined towards mid-term ventures, with bonds, especially OFZs, being a significant exception where waived fees are used to stimulate investment. People are shifting from short-term deposits to two- to three-year OFZs, prioritizing this investment horizon.
External Factors
- After the latest replacement stage, geographical diversification may no longer be as vital for investors, as replaced securities still feature a connection to relevant currencies. The currency aspect is still taken care of, thanks to gold and other investment opportunities allowing a secure position in the currency market.
Interest in Capital Protection Products
- These products are still popular due to their lucrative return on capital while preserving its integrity. "Promomed's recent hybrid bond issuance, for instance, was met with great enthusiasm, demonstrating ongoing demand for such innovative investment tools.
** pass of the Negative Russian Market State**
- The market tides have shifted slightly, offering a glimmer of hope, but we're still waiting to see the evidence of a true turning point.
Enrichment Insights:
- Innovation Sectors: Investors are pouring money into technology-driven sectors, including artificial intelligence (AI), software, data, computing hardware, and research and development (R&D). The quantum computing industry is a prime example of this focus.
- Residential Real Estate: Regulatory hurdles and affordability challenges have made it difficult for investors to find success in the residential real estate sector. However, relaxation around land-use policies could lead to increased residential investment opportunities in the future.
- Public Infrastructure & Green Investments: Public funding for infrastructure projects in energy security, green, and digital technologies remain essential for long-term economic growth.
- Classic Cars: This niche market continues to enjoy investment growth due in part to the U.S.'s 25-year import rule, opening access to valuable classic muscle cars.
- Precious Metals: Gold and silver maintain their appeal as permanent safeguards against economic uncertainties.
- Liquid Alternatives: More investors are turning to these adaptable instruments to help manage persistent inflation and unpredictable interest rates.
- Investment Strategies: Investors exhibit a cautious, yet targeted risk appetite, opting for selective, high-quality investments with clear commercial potential. They also allocate funds to tangible assets like classic cars and precious metals to hedge against market instability.
Finance plays a significant role in the current investment landscape, with investors increasingly showing interest in fixed income and bonds, extending high-yield periods. The discussion about rising interest rates and the cost of money is prevalent among investors, reflecting a risk appetite that has increased from the previous year, showing a significant surge into bond investments. (Trending Market Issues and Investor Focus, Risk Appetite Analysis)
Innovative investment tools, such as capital protection products, continue to be popular due to their ability to offer lucrative returns while preserving capital integrity. For instance, the recent hybrid bond issuance by "Promomed" has met with great enthusiasm, demonstrating ongoing demand for such forward-thinking investment instruments. (Interest in Capital Protection Products)
