Investors will increasingly target sustainable yields in 2013, particularly in an environment of lower interest rates and improving economic growth, according to Standard Life Investments.
Those sustainable yields will come from a mixture of credit, equities and real estate, the global investment manager stated in its December Global Perspective.
The manager forecast that a "moderate expansion" in 2013 should allow global profit growth to revive to about 5-10 per cent per annum.
"The global economy will be supported by improvements in the US and China/Asia in 2013, while the Eurozone and Japan will remain a drag on activity," said Andrew Milligan, head of global strategy, Standard Life Investments.
"US economic growth will be about 2 per cent per annum in 2013, restrained by fiscal tightening worth 1 per cent of [gross domestic product]."
Mr Milligan predicted global equities would trade mid-range in terms of valuations in 2013, "sufficient to suggest 5-10 per cent per annum returns for a long-term investor".
He also said real estate looked attractive in many regions and anticipated returns of 7-8 per cent.
"Sovereign wealth and pension fund allocations to commercial property are expected to increase in the coming year as managers seek higher-yielding assets.
"Credit is becoming somewhat less attractive, partly as valuations tighten in and partly as issuance surges with lower quality offerings," he said.
However Milligan identified commodity prices as a risk to monitor in 2013.
"Although the global economy continues to suffer from major fractures, notably in Europe, we are becoming more confident about a sustainable upturn in the global economy appearing by 2014.
"Nevertheless, there are risks to overcome - political tension, the squeeze on profits, sharp commodity price moves - which all mean financial markets should remain volatile, if not as marked in 2013 as in 2011-12," Mr Milligan said.
