We expect positive, albeit lower, returns as economies continue to re-open.
The pandemic remains a social and health concern. With the vaccine roll-out and reopening of major economics, it is less of a concern for risky assets. Targets are being revised upwards, and economies are entering a new phase.
We are sticking with our long equities, short duration portfolio positioning. We see some pockets of value. The US equity market seems to have priced in an awful lot of good news, but this only further supports the ongoing stop-and-start rotation towards Europe. Emerging Markets offer some attractive equity valuations. In Fixed Income, we are not keeping our duration short, we are focusing in the higher-yielding areas. We are mindful of the risks, which we describe further in our full note, and retain some option protection.
Portfolio management is about long-term trends. We describe our expectations for paradigm shifts. Yes, shifts. Plural.
Read on......
