Stay Invested in Asian Equities: Strategist

Equity markets have made impressive gains from March's lows. And with more economic data driving the global recovery story, investors don't want to miss out on the potential gains that stocks offer.

Mark Matthews, Asia Pacific strategist at Fox Pitt Kelton said one should stay invested in Asian equities. But he cautioned that improved conditions in the U.S. economy would draw foreign interests out of Asia, so look for markets in the region with a strong local investor base.

"The ones that I think I am very comfortable with are the ones with a large retail investor base to back things up, like Indonesia. I am still feeling very good about Singapore," he said on CNBC Asia's "Protect Your Wealth."

He is underweight China's H-share market, as he explained: "Basically H-shares do not have a local investor base to fill the void of foreigners."

Hence, Matthews said he expects H-shares, which have done very well this year to "underperform going forward because the local Hong Kong people don't usually buy the Chinese stocks listed here."

Matthews also favored companies that provide good yields and has allocated about half his portfolio for such stocks.

"Markets have gone up a lot so I do want to have some yield stocks," he explained. "If I were to just throw one idea at you, I think the Philippine telecom companies are vey good oligopolistic businesses. 11 times P/E is what you're paying for PLDT, or Globe for 8 percent dividend yield. The Philippine market itself is on 15 times, so they're certainly at a discount."

Philip Niem, head of Asian discretionary portfolio management at Barclays Wealth, said to go for a diversified portfolio of quality Asian stocks to secure returns over a three-year time frame.

Good Value in China Properties

Niem, who continued to be positive about equities, said he likes Chinese property plays as he believes the sector offers value after its recent sharp correction.

"We do believe that from a fundamental consideration... the Chinese property sector will be quite key to the growth of domestic demand within the PRC. We do see policies unlikely to become very unfavourable any time soon. Furthermore, there has been a lot of money put into the Chinese financial system with the loans to-date up about 25 percent. This money is staying within the system, and we think will provide ample liquidity to fund purchases of property," he said.

Niem said he is also adding Chinese downstream oil stocks to his portfolio. He said refiners and distributors stand to benefit from the country's changes to its regulated fuel-pricing policies.

"We do see that the PRC government is moving towards more market-pricing as it strives to increase efficiency particularly within its domestic economy," he said. "They are better able to get market returns on their refining profits when they previously were unable to do. We believe this is not yet fully reflected in their share prices."

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Catch "Protect Your Wealth" on CNBC's Asia Pacific network every Tuesday on "CNBC's Cash Flow," Wednesday on "Asia Squawk Box" and Thursday on "Capital Connection."