Investing

While the price of gas shot through the roof last week, it seems that a real energy crisis can be avoided in the short term now that Vladimir Putin is going to supply extra gas. Nevertheless, the unexpected turbulence in the energy market is reason for ING to reassess its investment strategies. It is a perfect storm.

There is a risky and dangerous novelty in the financial markets: “the prices of stocks, bonds and real estate, the three most important asset classes in the United States, are all extremely high”. 

That is the warning from Robert Shiller, the 2013 Nobel Prize-winning economist and scientist, in an opinion piece in the New York Times. “Never have the three been so overvalued at the same time in modern history.”

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“The abnormally high inelasticity of supply in relation to house prices, cannot continue without affecting the banking, financial systems and national economic system,” was the stark warning issued by the Luxembourg Centre Bank (BCL) in its latest Financial Stability Review.

Faced with the recent strong growth of demand for sustainable investing products, the question can be asked: are fund distributors able to keep up with asset managers in equipping themselves to deliver what such investors are seeking? One participant at the recent ALFI Global Distribution Conference expressed some doubt.

Sustainable funds have grown significantly in the past few years, according to a new study. Sustainable funds’ net assets have increased by as much as 450% since 2018, rising sharply as a share of total fund assets.

Net new money invested in such funds was positive Europe-wide, up 50% in June 2021, reflecting 510% increase of net new money into sustainable funds over the 2018 level.

With the Chinese government cracking down, foreign investors are reassessing their exposure to China. It is a balancing act between capitalising on the lucrative opportunities the country offers and protecting portfolios against the apparent arbitrariness of the government. The attentive investor can nevertheless hold on to a common thread.

The 10-year and 30-year US yields are pushing towards the top of their trend channels. These interest rates are all-important for the further evolution of long-duration assets. 2 per cent on the 10-year segment seems to be a breaking point. A barbell strategy between value and growth may offer a solution.

Although the UK led the way in the rollout of vaccinations and Brexit was largely overshadowed by the Covid pandemic and reopening, the divorce continues to cause uncertainty among investors. 

“Due to the search for yield, a “shut up and take my money” sentiment is starting to emerge in the world of high-yield corporate bonds. Investors would be wise to be more cautious in allocating money to the high-yield markets. It is dangerous to stay in the highest-risk segment with the idea that things will go well for another six months”, according to Sander Bus, managing director and co-head of the credit team at Robeco, speaking in an interview with Fondsnieuws, Investment Officer Luxembourg’s sister publication.

Deutsche Bank Belgium aims to position itself as a global player and to expand further in the private & wealth management segment. Local presence is important. The distinguishing factor compared to other private banks and wealth managers is that Deutsche Bank Belgium focuses primarily on investment advice and support, including for small portfolios. The standard discretionary management of the competition is definitely not the strategy pursued.