Asia Pacific investors are increasingly interested in European markets
According to the study conducted in August and September 2025 by BNP Paribas Asset Management among 300 professional investors in Australia, Japan, Hong Kong and Singapore "Europe Rising: The 2025 APAC Investor Pulse", 76% of investors surveyed say they intend to increase their share of assets in Europe over the next 12 months. Three-quarters of them already hold more than 11% of their portfolios in European assets. Australia (87%), Hong Kong (83%) and Singapore (80%) show the strongest intentions to increase this exposure. This dynamic reflects a trend of strategic reorientation of capital towards Europe, which is gradually establishing itself as the new destination of choice for APAC investors.
Invest in Europe or the United States?
The study confirms that Europe is now seen as a credible alternative to US market dominance. 60% of APAC professional investors surveyed believe that Europe is now a more attractive long-term investment destination than the US, due to the global geopolitical environment. This does not mean that APAC investors are disengaging from the United States but does demonstrate a rebalancing of allocations in favour of Europe. After several years of hegemony of US equities, Europe is benefiting from a structural reassessment.
What makes Europe attractive today?
Several factors explain increased interest. First, Europe benefits from an ambitious public investment policy, as illustrated by Germany which has committed €500 billion to infrastructure and defence. This dynamic is part of a regional trend towards reindustrialisation and energy transition, strengthening the long-term competitiveness of the old continent. 80% of APAC investors believe that these European initiatives are likely to reshape Europe’s long-term economic outlook and boost the future performance of local companies.
Furthermore, 38% of respondents point out that the valuations of European companies are now more competitive than those of American companies.
Finally, macroeconomic stability and clarity of monetary policies, coupled with the credibility of the European Central Bank, reassure investors in a global context marked by volatility.
Diversification and returns: priorities for APAC investors
For many investors in Asia Pacific, boosting their European allocation is a key aspect of their geographic and sector diversification approach. 45% of respondents are looking to reduce concentration risks and explore new markets or instruments. Return expectations are high: 71% are targeting returns of between 5% and 14% in 2025, with confidence rooted in well-defined investment goals and thoughtful asset allocation strategies.
The most popular European assets are developed market equities, precious metals, private equity and real estate. In addition, demand for European corporate bonds remains strong for their yield potential and resilience due to European monetary stability.
It should be noted that European private debt is gaining ground, particularly in Hong Kong.
Growing appetite for active management
In an environment marked by market volatility and concentration, Asia Pacific investors are reassessing their strategies. While passive management was popular during periods of low interest rates, 83% of respondents now believe that active management is essential to seize opportunities and control risks. This trend is particularly strong in Australia, where 93% of professionals favour the active approach.
What is the difference between active and passive management?
The difference between active and passive management is the approach used to manage a portfolio of investments. Active management involves actively selecting investments to beat market performance, with frequent analysis and adjustment, but this involves higher management costs and potentially risk of underperformance. Passive management, on the other hand, involves replicating a benchmark to track the markets, without active investment selection, resulting in lower management costs and reduced risk of underperformance. Investors should choose the approach that best suits their goals and risk tolerance.
At the dawn of 2026, Europe is once again at the centre of strategies for professional investors in Asia Pacific whose choices are driven by ambitious public policies, the search for greater diversification and attractive return prospects. For institutional players, this represents a major opportunity to capture new flows, thereby reinforcing Europe's position as a key hub for international investment.
