China, Russia Pare US Treasuries Holdings as Trade Tensions Rise. A Sign of Things to Come?

rtx1gzco.jpgPresident Donald Trump threatened to escalate the trade fight with China into an all-out trade war on Monday, promising to impose massive tariffs on Chinese goods unless Beijing reverses course on its own trade actions.

Meanwhile, foreign governments have pulled back their purchases of longer-term US debt as trade tensions escalate, with Russia dumping half of its holdings. Could this be a sign of things to come? Learn more

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Short-Termism

unnamed-2.jpg“Concentration on short-term projects or objectives for immediate profit at the expense of long-term security.”

Jernej Bukovec (CFA) of Momentum Global Investment Management, one of our UK regulated, discretionary fund managers highlights why short-termism is unhealthy for investors, changing portfolio positioning every time an investment underperforms and chasing outperforming investments. Click here to learn more.

Getting What You Want

Outdoor relaxInvesting is first and foremost about net returns. Our key value-add is being able to design better portfolios than a formulaic split between bonds and equities based on a client’s risk profile.

Richard Stutley (CFA) of Momentum Global Investment Management, one of our UK regulated, discretionary fund managers, brings some of this work to light. Click here to learn more.

Understanding the Recent Market Sell-off

Not widely welcomed, but arguably overdue?

The sharp sell-off in stocks that started last week and gathered steam this week lacked a specific trigger — unlike the last time US shares fell this much, which came in the wake of the US losing its AAA sovereign rating at S&P Global Ratings in 2011.

As with plane crashes, the experts are pointing to a confluence of factors, from concerns over the path of Federal Reserve interest-rate increases to a rapid unwinding of trades predicated on continued low volatility in markets.

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Investor Confidence Is High – Why Are We Surprised?

ftse100-14-feb-2017Survey data out of both the US and UK in recent months has confounded perceived wisdom
because despite significant political upheaval in these countries last year, confidence has improved.

This is something of a surprise because such substantial changes may be considered a destabilisation risk given the relative fragility of confidence following the global financial crisis.  Indeed, only twelve months ago the market would seemingly fall regardless of news flow as a combination of weak resource prices, concerns over China and now long forgotten whispers about the end of the credit cycle provided a negative background that was difficult to overlook.

To paraphrase Charles Mackay, author of Extraordinary Popular Delusions and the Madness of Crowds (first published in 1841) market participants were gripped by fear and in that condition investors saw risk even in enticing opportunities.

James Klempster (CFA), Head of Portfolio Management for Momentum Global Investment Management shares his view. Click here to view.

PortfolioMetrix Market Review and 2017 Outlook

A large computerised display of the Brit2016 was a year dominated by political upsets and upheavals but, despite the shocks experienced – fears of Chinese debt implosion, Brexit, Trump, various terrorist attacks, Leicester City winning the Premier League – it was an extremely strong year for markets overall. In fact, one of those years that beautifully illustrates the value of ‘time in the markets’, as opposed to ‘timing the markets’.
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PortfolioMetrix November Market Update

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The big news of the month was the election of Donald Trump as 45th president of the United States of America which world equity markets ultimately responded well to when viewed in local currencies. Bonds, however, generally fell in price as whilst Trump’s spending plans are likely to spur short to medium term growth they look likely to radically increase the fiscal deficit and push up inflation. For UK investors, after a tough post EU referendum period, the pound strengthened strongly in November which put pressure on the returns of overseas assets when converted back to sterling. Learn more