Finansa Asset Management expects flat growth in the second half, with assets under management expected to remain unchanged through December at 20 billion baht. Teera Phutrakul, the executive chairman of Finansa Asset Management (FAM), said investors were clearly preferring to hold cash due to market volatility and fear of the economy sliding into ''stagflation'', where growth slows and inflation rises.
He said that despite the volatility in the stock market, recent declines had made shares a good investment for the long term.
FAM is currently recommending that its investors increase their weightings in equity funds, such as the Finansa Enhanced Equity Fund (15.15% for the first half), the Finansa Long-term equity fund (14.17% over 12 months) and the Finansa retirement mutual fund (3.21% over 12 months).
Finansa's Global Commodity fund, a foreign investment fund with a 47% return for the first half, led all mutual funds in Thailand according to fund intelligence company Lipper.
Mr Teera said fund managers in the second half would continue to struggle with risks such as high inflation, political uncertainties and rising interest rates.
But he said the increased tax deduction for RMFs and LTFs to 500,000 baht each from 300,000 would benefit the fund industry this year, as well as the launch on Monday of the Deposit Protection Agency and easing of provident fund rules.