Hong Kong investors most eager in Asia to beat markets – but temper return hopes: report

Hong Kong investors are Asia’s most ambitious stock pickers, but they have much more subdued return expectations than regional peers swept up in enthusiasm over artificial intelligence, according to a survey by a global asset management firm.

Some 95 per cent of Hong Kong respondents said they wanted to outperform the market, the highest proportion in Asia, where the average stood at 85 per cent, according to a survey conducted in August by Natixis Investment Managers.

Hong Kong investors expected long-term returns of 12.3 per cent above inflation, compared with the regional average of 17.3 per cent, the survey found, as an 18-month rally partly fuelled by the AI boom inflated expectations.

The survey polled 750 individual investors holding at least US$100,000 in investible assets across Hong Kong, Japan, Singapore, South Korea and Taiwan.

Hong Kong financial advisers put realistic long-term returns at 8.8 per cent, the report said. Investors’ expectations exceeded that estimate by 40 per cent, a narrower gap than the 84 per cent in Singapore and 110 per cent in South Korea.

The Hong Kong gap stood at 16 per cent a year earlier, said Dave Goodsell, executive director at the Natixis Centre for Investor Insight, at a media briefing on Thursday.

Charlie Tsai, head of Hong Kong at the firm, said in a statement that the more measured expectations were likely due in part to “the strength of the local equity market and improving real estate picture we’ve seen over the past year, helping to moderate enthusiasm for the AI supercycle”.

The Hang Seng Index gained about 28 per cent in 2025, its best annual performance since 2017, but has fallen more than 8 per cent this year. By comparison, benchmark equity indices in South Korea and Taiwan have repeatedly set record highs, driven by soaring global demand for AI chips.

Hong Kong’s broader economic fundamentals have also shown signs of stabilising. The city’s initial public offering market raised a record HK$388 billion (US$49.4 billion) in the first nine months of the year, while residential property prices rose about 7 per cent through August.

Goodsell said a market downturn was the top concern among Hong Kong investors, while inflation and interest rates ranked highest elsewhere in Asia.

US long-term bond yields hit their highest level since 2002 this month, which Financial Secretary Paul Chan Mo-po said in his weekly blog last week had “inevitably dampened recent sentiment in the Hong Kong stock market”.

Despite the headwinds, Natixis remained positive on risk assets, according to Mabrouk Chetouane, head of global market strategy at the firm.

Chetouane said Natixis had raised its allocation to US equities to the maximum permitted level within its model portfolios, citing the start of third-quarter earnings season and continued support from AI.

He also described the simultaneous surge in bond yields and equity prices as “quite unusual”.

Natixis said a recency bias in return expectations appeared at odds with investors’ risk tolerance. Some 73 per cent of respondents across Asia described themselves as conservative or moderate investors, while 76 per cent said they would choose safety over performance if forced to pick one.

“We’ve always seen that investors are extrapolators,” Goodsell said. “They think that if the market’s going up, it’s going to keep coming up.”