Listed infrastructure investment posted positive inflows last year, Standard & Poor’s (S&P) Fund Services said in a report released yesterday.
Investment in listed infrastructure around the world grew to US$2.4 trillion as of 31 December 2010, according to S&P Fund Services’ Listed Infrastructure Sector Report.
Strong performance in the sector helped investors overcome jitters evident elsewhere in financial markets, S&P Fund Services analyst Simone Gavin said.
“The total investment is certainly growing. There’s been an increase in the number of listed infrastructure investments in emerging markets from last year,” Gavin told InvestorDaily.
She said international trends towards private ownership and management of these assets were also key growth drivers.
Macro-economic factors had been an important consideration when researching the sector because some companies had been affected by sovereign and regulatory risks, and some industries had high economic growth correlations, she said.
“Performance bounced back significantly following the financial crisis and, over the past year, listed infrastructure stocks performed more in line with what is expected on an absolute basis – low double-digit returns,” she said.
“It continues to be a relatively immature market given the long-term nature of investments and we believe investors need to have at least a five-year investment horizon.”
She said the report covered eight managers and 12 listed infrastructure funds, including 10 global vehicles, one emerging markets fund and one domestic investment.
The report gauged the structure of investment teams; how the team split its coverage; and differences in the universes in which each manager invested, she said.
“Other themes we explore include how macro-economic input affects positioning and we provide an update on fund flows to these products and the correlation of listed infrastructure with other asset classes,” she said.
