These are my key takeouts from Markets Summit 2019's Faculty of investment thinkers from around the world offering their high conviction ideas on the drivers of and outlook for the markets.
Hamish Douglass, Andrew Canobi, Brett Gillespie, Tim Farrelly, Charles Jamieson, Peter Kim, Stephen Miller, AJ Qualtieri, Randal Jenneke, and Thomas Vester convened to debate their Markets Summit 2019 key takeouts and the portfolio construction implications.
Few clients have the 20-year horizon required for today’s strategically-oriented models to become consistent with suggested outcomes, such as CPI+4%. This builds in a structural mismatch.
Investors are so focused on predicting the end of this economic cycle they have missed the fact that it simply won't. A recession will be avoided and the cycle will extend.
It’s a Quantitative Tightening world and the tide is receding. QT appears set to continue in 2019 and bonds should continue to perform well.
Banks are a defensive fixed income investment. This may sound counterintuitive only a decade removed from the most prolific financial crisis of our lifetime.
Nearly a decade after one of the great debt binges of all time, Chinese economic growth and credit creation have slowed. Today, stimulus is being undertaken. This is not a crisis, this is reform.
As recessionary pressures continue to build, rotating portfolios toward high grade, defensive assets will prove to be a prescient asset allocation decision for investors.
The vast majority of emerging market economies are fundamentally healthy and are being driven by broad thematics, not just evolving consumption patterns.
While infrastructure is known as a defensive asset class, it is set for enormous growth over coming decades, making it an attractive investment proposition for years to come.
Recent central bank decisions have strengthened the conviction that the New Neutral is a global reality which will have long-term implications on investment decisions.
Global high yield corporate bonds represent an attractive asset class for investors searching for a diversified source of income.
Easy money in credit markets is gone, and corporate bonds face more risk for less return. Structural liquidity deterioration raises a black swan risk of a disorderly sell-off spilling into other markets.
The best chance for survival among what were regarded as the most defensive of stocks is to be the biggest, most revered brand – or at least hold second spot. Others will struggle and many will disappear.
The new normal is a world of higher systemic risk, which implies portfolio managers will need to dig more deeply into their tool kit of risk-understanding and mitigation techniques.
Slowing growth with extreme recession risk, coupled with a combative populist government, may well see Italy trigger a crisis in European debt and the currency, causing a substantial global volatility event.
Rates are normalising, populism is on the rise, technology is driving disruption. But not every perceived winner will win and not every perceived loser will be destroyed forever.
On some measures, global equity valuations are the most attractive in several years. Risks, however, have certainly increased and in many cases are more difficult to frame.
For most of the last 10 years, the world's major central banks have been creating significant amounts of cheap money, inflating several bubbles. Those bubbles are beginning to burst.
Drawing on his unique background as part of the elite leadership team of the CIA's Clandestine Service, David shares his views and analysis of the current geopolitical landscape.
Much macroeconomic analysis is very narrow in scope. ESG factors are ignored all together. A new indicator of national progress measures economic dynamism and progress on meeting ESG goals.
Two of the defining characteristics of the global investment landscape over the last 30 years are being reversed - globalisation (by economic nationalism) and finalisation (as we've reached peak debt).
Portfolio Construction Forum Markets Summit is THE investment markets scene setter of the year. The jam-packed blended learning program is designed and curated by our specialist, experienced and independent team and features our Faculty of 20+ leading investment thinkers from around the world. Each offers his/her best high conviction ideas on the drivers of and outlook for the markets (on a three- to five-year view), in the context of the theme - The heat is on! - and the implications for portfolios.
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