$1 Trillion Asset Manager Betting Heavily On Equities Turnaround in 2019written by Bella Palmer
Following a volatile year that will end in losses
A bad 2018 that has seen valuations decline, combined with faith that global growth will do better than many expect in 2019, is the basis for Bunglawala’s position. His fund is leaning towards emerging markets as a
It’s a contrarian view with most major investors currently very bearish after a painful 12 months for stock markets. The MSCI World Index is set to finish the year to its worst return since 2008 – the eye of the storm of the international financial crisis that devastated financial markets. 2018 also has the unwanted distinction of being the year where investors in both equities and debt benchmarks will both see negative returns for the first time since as far back as 1998.
However, the capital flight from emerging markets this year does mean that major investors have the most positive sentiment towards them in a decade. The sell-off appears to have been overcooked and now offers value. But Bunglawala has toned down his fund’s exposure to European stocks from an overweight position earlier in the year over concerns around the impact of Brexit and the Italian debt crisis. The approach to UK companies is also ‘neutral’.
“Whilst we expect to see converging growth, through improvements in non-U
A bullish approach to equities is brave in the current environment and might just give those investing online who had planned a year of entrenchment in 2019 something to think about.
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