Emerging markets: increasing or decreasing risks?

So far, 2018 has been a difficult year for emerging market (EM) assets, which in the last few months have fared significantly worse than their counterparts in developed markets. This has been due mainly to worldwide issues but also country-specific political uncertainty. Many investors are now asking if the sell-off presents a buying opportunity – … Continue reading “Emerging markets: increasing or decreasing risks?”

Investors dump equity in favour of safe havens

Government bonds received a boost in demand last month as investors’ risk appetite was tested by volatility in equity markets. This risk-off attitude proved negative for corporate bonds, however. The looming threat of a trade war between the US and China sent shockwaves throughout equity markets last month, as investors braced for the impact of … Continue reading “Investors dump equity in favour of safe havens”

Why I need a financial adviser

Combining risk frameworks with appropriate asset allocation is no mean feat. Economists call them “teachable moments” – life events which make us think more about long-term financial planning. Until my 40th birthday, I barely thought of my mortality. But since then I have barely thought of anything else. A major birthday milestone, combined with the … Continue reading “Why I need a financial adviser”

Signal or noise? Political risk in 2018

Proliferation of weapons of mass destruction. Terrorism. Populism. A newly emboldened Russia. The world is an unsettled place, but financial markets are relatively calm. A few factors could yet jolt them. US equity markets have generated significant gains over the last year, despite the headlines speculating over possible Russian interference in the US presidential election, … Continue reading “Signal or noise? Political risk in 2018”

Where should investors look for opportunities in 2018?

After a turbo-charged 2017 investors have become nervous of a market sell-off. Among the signs: technology stocks have wobbled recently; high yield corporate bond spreads – the risk premium corporate bonds provide over government bonds – have narrowed to levels not seen since the financial crisis; and speculation has driven a bitcoin frenzy. But while … Continue reading “Where should investors look for opportunities in 2018?”

Germany shows there is still political risk in the Eurozone

When the Netherlands kept Mr Wilders out of power and Mr Macron swept into office in France, the immediate threats to the Euro disappeared. The recent collapse of coalition talks in Germany does not presage any undermining of majority support for the single currency in its heartland. The next major political issue facing the Euro … Continue reading “Germany shows there is still political risk in the Eurozone”

Back to Basics: Investing is a long term game

Believing that ‘now’ is the most difficult point in history to make sense of markets is one of the biases which investment professionals can pick up from their extreme proximity to the volatility, uncertainty and surprise that go with investing money. The cure to these jitters is just to step back and review some of … Continue reading “Back to Basics: Investing is a long term game”

Are markets underestimating geopolitical risk?

Every week it appears that North Korea tests a missile that falls safely in the Sea of Japan. Saudi Arabia and its close neighbour Qatar are having a spat about terrorism funding, could they come to blows and what would that mean for the oil price? Should we worry about such events? And how will … Continue reading “Are markets underestimating geopolitical risk?”

Worries should rise when complacency builds

A new Bank of England index measuring uncertainty shows investors are remarkably complacent about Brexit. The Bank’s Quarterly Inflation Report now contains an uncertainty index. It pulls together a range of market, survey and forecast variables to show how much uncertainty there is during a particular month compared to the historical average (or what you … Continue reading “Worries should rise when complacency builds”

China’s Black Monday – one year on

This week marks the anniversary of last year’s stock market crash that some have dubbed China’s Black Monday. Shanghai shares fell 8.5% on August 24, triggering losses on exchanges around the world and causing mayhem in currency and commodity markets. Apart from the financial losses, the market meltdown damaged the reputation of China’s policymakers. The … Continue reading “China’s Black Monday – one year on”