Investing

The coronavirus is causing ‘a clear shock to the world economy’, according to Columbia Threadneedle. Janus Henderson calls the global spreading of the coronavirus ‘a real game changer that has dashed hopes of a V-shaped recovery in global growth.’ 
 
‘So far we are seeing two clear consequences: lower consumption and less supply,’ says Neil Robson of Columbia Threadneedle. He illustrates the first concern citing the Adidas market update last week, showing a 85% decline in activity in China. 

ETFs can be a source of systemic risk because they can induce important feedback effects in markets, such as increased volatility in periods of market stress. However, these effects can be mitigated by regulators, according to a research paper by Maureen O’Hara (pictured) of Cornell University and assistent-professor Ayan Bhattacharya of the City University of New York.

Global dividends rose 3.5% in 2019 to a new record of  1.43 trillion dollars (1.32 trillion euros), according to the Janus Henderson Investors Global Dividend Index. Dividend growth in Europe lagged other markets.

Earning no yield on gold is better than a negative yield on bonds. Therefore investors should shift the allocation of their portfolios from negative yielding bonds to gold, according to Quintet.

Quintet (formerly KBL European Private Bankers) is positive about alternatives and tends to have an overweight in gold both for the long and short term.  

Between 2016 and 2020, China spent more than 5.5bn renminbi (715bn euros) on environmental investments. But these massive sums of money are yet to translate into interesting investment opportunities in the country. Fund manager Yi Du of Pictet Global Environmental Opportunities (GEO) explains why this is the case.

Equity markets are starting 2020 on an optimistic note. Investors are celebrating the preliminary US-China trade deal and equities are trading at record highs. Investment Officer asked three prominent investors  representing global asset managers for their views. Today, we ask Stefan Kreuzkamp, CIO of DWS.

2020 will probably not be a great year for bonds. The low interest rates could even precipitate a shock to the financial system eventually. The outlook for equities is somewhat more promising, even though it’s difficult to grow earnings in the current low-growth environment, says Chris Iggo, CIO of AXA IM, in the second part of our 2020 outlook series. 

The world economy is showing signs of recovery. Over the fourth quarter, investors have anticipated a more stable macro environment by driving up equity market valuations. The ‘very large Phase One Deal’ that was announced by President Trump on Twitter earlier this month may not be as comprehensive as suggested. But markets have given Trump the benefit of doubt and have continued to move up.

The value factor has been disappointing investors for years. However, combining value with quality turns underperformance into stable outperformance, according to French boutique asset manager Seeyond AM. Seeyond has called the ‘new’ factor smart value.

Factor investing in bonds is making inroads with both institutional and wholesale investors, according to a study by Invesco. However, there’s still a perceived lack of suitable products.