Asset Allocation

The debate between value and growth is pointless, says Guy Lerminiaux, CIO of Degroof Petercam Asset Management. ‘This is not a productive debate. You have to look at it on a company-by-company basis. In every sector you find winners and losers.’

Investors will face tough challenges in the coming years, according to Pimco. While volatility will remain high due to the presence of numerous potential ‘disruptors’, return prospects have never been lower.

Foreign investors and central banks will continue increasing their allocation to Chinese government bonds. They offer a relatively high yield and are a safe investment, says Freddy Wong, head of Fixed Income Asia-Pacific at Invesco.

External valuations of retail properties are unreliable. Our models indicate considerably lower prices and therefore much higher debt ratios, says real estate specialist of Egbert Nijmeijer of Kempen Capital Management.

Retail property has been hit hard by the coronavirus crisis. Nevertheless, external surveyors were remarkably lenient in their half-yearly valuations. For example, for Eurocommercial Properties and Klépierre, which operate comparable medium-sized shopping centres in Europe, the downward revaluation was limited to just under 3%.

 The prices of European banking stocks have fallen to their lowest level in more than 30 years. The banks are weighing on a further recovery of the European indices, which have too few ‘asset light’ business models.

Until 30 September, the return of the European banking index stood at -43.66%. Over the past three years, the return is -24.39% and over the past five years it’s -13.36%.

The weakening dollar has been a boon for emerging market debt in recent months. Spreads have narrowed and inflows quickly turned positive again. However, investors seem to already be looking for the exit again.

Investors should increase risk as some traditional safe havens are losing their shine, Robeco says in its five-year outlook titled ‘A Brave Real World’. Investment Officer spoke with Peter van der Welle, strategist in Robeco’s Global Macro team, about the asset manager’s outlook.

Global equities can rise by up to 75% over the next five years driven by profit growth, according to Knut Gezelius, lead manager of the Skagen Global fund.

Skagen is known for its active, value-based investment philosophy. But if you look at the largest positions of the global equity fund, you’ll mostly see prominent growth stocks such as Microsoft, Adobe, Alphabet and Mastercard. What happened?

It’s less than six weeks to the US presidential elections. Capital Group has made a few rules of thumb for investors to give some guidance.

Solid growth companies will continue to live up to high expectations by showing strong profit growth. This offers the prospect of an attractive total return after inflation of 7-10% per annum on average over the long term, according to manager George Dent of the BNY Mellon Long-Term Global Equity Fund.