Opinion

Over the past year, Nvidia’s stock has soared by more than 200%, igniting talks of a “bubble” among the self-proclaimed financial seers. But what precisely do we mean by a “bubble”? This term, often thrown around loosely, lacks a consistent definition among its most vocal proponents.

In a world inundated with political polarisation and partisan scepticism, it’s easy to get lost in the noise surrounding climate change, green-washing, over-regulation and what some may dismiss as mere ‘wokeness.’ Yet, amidst this tumultuous backdrop, a quiet revolution has been taking place within the investment industry. 

Over the past decade, responsible investment funds have emerged as a steady force, defying all the sceptics, and maintaining market share while experiencing a surge in assets. 

On 19 January 2024, the Council of the European Union published the final compromise containing amendments to Directive 2009/138/EC (Solvency II). The text contains details of the modified “Long-term equity investments” (LTE) sub-model (with a favourable 22% capital charge) and a specific treatment for Eltifs and other “low risk” AIFs. This contribution sheds some light on the implications of these amendments for insurers in the fund context.

As European skies darken with the storm clouds of geopolitical tensions, particularly the shadow cast by Russia’s war against Ukraine, a stark dilemma has emerged on the horizon for the continent’s asset managers. This quandary, deeply rooted in the ethos of sustainable investment principles, challenges the very fabric of Environmental, Social, and Governance (ESG) advocacy. The question that now looms large is whether investments in the defence industry can be harmonised with the steadfast commitment to sustainability.

Comparatively minimal macroeconomic news of substance emerges from China; however, the information that does reach me through Bloomberg and other outlets offers little cause for optimism. To illustrate the initial point: a decade ago, China’s National Bureau of Statistics released over 80,000 economic indicators; presently, this figure has dwindled to fewer than 10,000.

Chinese stocks are the opposite of US Big Tech stocks in almost every way. They are cheap, but nevertheless unloved.

Those looking to invest in emerging markets can even choose a variant of emerging markets ex-China these days. Consequently, global equity portfolios hardly contain any Chinese stocks anymore. This means that just a little bit of good news can cause a sharp price recovery. The time has come to include more Chinese equities in portfolios.

Ireland’s competitive tax policies and workforce have attracted numerous fund promoters, propelling the country to become the EU’s fastest-growing and second-largest fund domicile. Despite these impressive achievements, Ireland faces challenges in overtaking Luxembourg as the leading destination for funds.

In the ever-escalating tech tug-of-war between China and the United States, the dragon nation is unleashing a full-scale mobilization to propel its technological prowess forward. The gloves are off as the U.S. and its partners continue to throw up roadblocks, ushering in an era of deglobalization, at least on the political front.

On Tuesday the eight-day People’s Congress in China, an annual parliamentary gathering drawing thousands of delegates from across the nation, kicked off. Premier Li Qiang will address the congress, detailing targets for economic growth and military spending. This year holds added significance as it marks the 75th anniversary of the People’s Republic, prompting a reflection on its achievements.

Investors err in assessing stock returns. Prominent outliers attract undue attention and garner more interest than stocks with market-average returns. However, such stocks don’t necessarily make better investments; in fact, this strategy results in reduced returns for investors.