Predicting the returns for different asset classes is the Holy Grail of asset allocation. The problem is that risk premiums and returns are instable over time. According to our analysis, over the long term (our data stretches back 115 years) there is a 90 percent probability of achieving an annual average return of 8 percent […]
Asset Allocation While the recent sell-off might have been overdone in view of fundamentals that remain basically sound, market gyrations and our expectation of further volatility mean we remain neutral equities overall. The current environment favours active management and a tactical allocation approach, exemplified by the partial sale of equity options we acquired to protect […]
Asset Allocation We remain underweight or neutral across a number of risk asset classes and overweight liquidity in light of enduring uncertainties, but stand ready to deploy cash as tactical opportunities present themselves. We are neutral DM equities, but pockets of opportunity still exist (in the UK and Japan, for example). EM equities are becoming […]
Asset Allocation We maintain our neutral stance on equities overall on a rolling three-to-six month basis. We do have a more upbeat assessment further out, but the autumn is shaping up to be a sensitive time for risk assets overall. Recent sell-offs validate our cautiousness regarding emerging-market (EM) assets in general. But valuations are becoming […]
Asset Allocation On a tactical, rolling three-to-six-month basis we are maintaining our neutral stance on developed-market equities in general in light of increasing trade and political frictions, but we remain more upbeat on their prospects further out. We have a bullish short-term stance on Asian (ex-Japan) equities given their increasingly attractive valuations but we are […]
Asset Allocation On a tactical, rolling three-to-six-month basis, we are tilting away from a bullish to a neutral stance on developed-market equities as trade and political frictions are rising. That said, we remain more upbeat on their prospects after the summer. Recent sell-offs have vindicated our cautiousness regarding emerging-market assets in general. But valuations are […]
Asset Allocation Overall, we remain cautiously optimistic about risk assets. We expect economic growth to rebound after a ‘soft patch’ and corporate profitability remains strong, as revealed in Q1 earnings reports. But we recognise that the environment is becoming more challenging for investors. The current environment requires active managers’ heightened sense of adaptability. While we […]
Christophe Donay, Chief Strategist, Head of Asset Allocation & Macro Research, Pictet Wealth Management Since the beginning of the year, depending on currency, many asset classes have recorded negative or only marginally positive returns. In US dollar terms, US and global equity indices (MSCI World) have produced total returns of below 0.5% since 1 January, […]
Asset Allocation In spite of a certain loss of momentum in positive surprises, a strong Q1 earnings season continues to justify our bullish stance on equities in most regions. We reiterate our negative view on core government bonds and remain short duration. Volatility is still higher than last year, and has increased noticeably in the […]
Asset Allocation While macroeconomic and corporate fundamentals still favour risk assets, challenges have been steadily increasing and a lot of good news is already priced into valuations. We sold part of our equity overweight during the early March rally. Even though we have become more prudent about equities’ short-term prospects, we expect to be able […]
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