Perspectives

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Overdiversification is a Risk

September, 2017

Imagine you are a school teacher. You are looking for a new job and there are two alternatives. The first involves a small school – there are 20 pupils. It isn’t an easy job. You will be responsible for keeping a very close eye on the children, analysing their every move every day and hoping […]

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Cyclical upswing, but what of the structural headwinds?

September, 2017

We held our quarterly investment conference this week where we discuss some of the key economic issues that we believe are driving global markets. The baseline is reasonably positive in that momentum in the world economy appears to be, if anything, strengthening. Lead indicators, business surveys and institutional research all point to continued expansion. At […]

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Where’s the wage growth?

September, 2017

We are in the middle of preparing and reviewing the data for our quarterly investment conference. Everyone has an opinion but it is always worth examining the raw economic information coming out of Central Banks, Government statistics organisations and other global institutions such as the World Bank and the IMF. Equally, it is always interesting […]

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Interest rate levels affect equity levels

September, 2017

Equity valuations are impacted by many factors: earnings, cashflows and market sentiment to name but a few. Interest rates play in important part in current prevailing equity valuations and we believe investors should be focussed on these at present because if low interest rates drive higher current equity valuations, then higher interest rates will inevitably […]

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Home from the Holidays

September, 2017

As Britain returns from the holiday break this year, followed inevitably by the sound of credit card bills falling onto the doormat, there may be a greater feeling of dread than usual. If you have travelled to the US or Europe, you will be acutely aware that not only has the “pound in your pocket” […]

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Hedging comes at a cost

August, 2017

Since being re-elected in December 2012, Shinzo Abe, the Japanese Prime Minister, has presided over an economic policy aimed at restoring growth to help the country repay its large government debts that have accumulated over recent decades. This policy has become known as Abenomics as it has focused on three distinct ‘arrows’: monetary reflation, fiscal […]

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Focus on Your Objective

August, 2017

Many in our industry focus on volatility of returns rather than the returns themselves and this can have a detrimental effect on client outcomes. Every investor should assess their risk appetite and their capacity for loss before making an investment. This helps them understand the risk they are willing to tolerate when trying to achieve […]

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Ten Years on

August, 2017

A lot is being written this month about the tenth anniversary of the financial crisis. In August 2007 the UK stock market started a period of volatility. Banks began to stop lending to each other due to market fears over exposure to potential losses on high-risk US mortgages. The credit crunch began in earnest. We […]

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Beware Low Volatility

August, 2017

Market volatility has fallen to very low levels over the past few years and this creates a conundrum for investors. Low volatility levels indicate that you can take on more risky exposure (to generate higher returns) for your risk budget. With volatility so low, should they embrace higher exposure to risk assets or, as we […]

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How can funds earn more than the people who invest in them?

July, 2017

Investors are taught that markets are unpredictable, that past performance is no guide to the future! Why then is past performance used by the average investor when making fund selection decisions? The following example is rather old, but holds true today and provides an insight into why the Tacit thought process steers clear of forecasts. […]