Benjamin Hamidi
Senior portfolio manager, ABN AMRO Investment Solutions. Based in: Paris, France
“Markets remain sensitive to geopolitical risks, with high energy prices more generally weakening business and market conditions. Persistent inflationary pressures and the Fed’s hawkish policy will weigh on demand, margins and profits. Some of this is already priced in and financial conditions remain robust. Still negative real interest rates, high level of cash and margins may support the equity market in the medium term. Therefore, for the time being, we decide to maintain a preference for equities over bonds, emerging markets and a balanced approach across styles.”
Luca Dal Mas
Senior fund analyst, Aviva Investors. Based in: London, UK
“Market focus has returned to inflation and central bank reactions to rising prices, with interest rates rising across all majors markets. Eurozone consumer confidence surprised to the downside in March, with German business confidence posting the second-largest decline since 2005. If sentiment remains at these levels, then a mid-2022 technical recession in the Eurozone looks more likely. Since equity markets seems to have discounted significant disruption, we have taken the opportunity to marginally increase and diversify our equity exposure.”
Kelly Prior
Investment Manager in the Multi-manager team, BMO Global Asset Management. Based in: London, UK
“March was a mixed month, with the US rebounding as Asian bond markets lagged, bringing to an end a negative quarter for almost all asset classes outside Japan value equities, impacted by war in Ukraine and subsequent moves in rates, commodities and inflation expectations. Findlay Park American led the way in our selections in March, with TT Asia ex-Japan bringing up the rear. We reserve judgement on making changes to the portfolio this month, but sense that the market drivers of the future may be different to the past few years.”
Jorge Velasco
Director of Investment Strategy, CaixaBank Private Banking. Based in: Madrid, Spain
“We have again slightly reduced our equity exposure after the recovery of the past few days, leaving it clearly underweight. We have shifted our thinking from tactical prudence to strategic prudence. We increased the weight of fixed income in the portfolio, maintaining the same defensive approach as in recent months. In equities, we have reduced our exposure to emerging markets somewhat, and eliminated some investment biases. No change in the portfolio weight of alternatives, although we did take the opportunity to make some name changes.”
Silvia Tenconi
Multimanager Investments & Unit Linked, Eurizon Capital SGR. Based in: Milan, Italy
“In March the performance of the portfolio was positive. After a retracement at the beginning of the month, equity markets started to rise once again, both because the Ukraine crisis had not evolved into a global crisis and because economic data were still strong. Main contributors were both US and European equities, while Asian and Japanese funds and our US High Yield exposure were flat. We keep our allocation unchanged: we’re closely monitoring interest rates, as there might be overshooting there at some point, and we’re following the evolution of the war in Ukraine.”
Richard Troue
Fund Manager, Hargreaves Lansdown Fund Managers. Based in: Bristol, UK
“We’re a quarter of the way through the year, but so much has happened in markets it feels like longer. The volatility we’ve seen should create opportunities for decent active managers. At this juncture it doesn’t seem appropriate to make big style calls or factor bets. I’m comfortable with an equity portfolio that has a mix of value and growth, and different sized businesses located all over the world. A more defensive tilt to the fixed-interest portfolio seems appropriate, as do some total return funds for a rainy day.”
Paul Hookway,
Senior Fund Analyst, Kleinwort Hambros. Based in: London, UK
“There was a momentary inversion between the ten-year and two-year government bond yields in the US at the end of the month, which is seen as a good predictor of a recession. While we see risks on the downside, we must also factor in the chances of a relief rally should there be a peaceful resolution in Ukraine. We saw no reason to make any changes to the portfolio, with potential outcomes to both the upside and downside. Sometimes inactivity is best, though we remain vigilant.”
Antti Saari
Chief Investment Strategist, Nordea investments. Based in: Copenhagen, Denmark
“Equity markets have gained since the lows on the outbreak of the war, and risk premia have fallen. With that, the further potential for a strong short-term rebound in the market is reduced, and we dial down our recommended overweight for equities versus bonds. We still believe that the outlook for growth, earnings and interest rates favours equities versus bonds in the medium term and recommend a 5 per cent overweight. We continue to recommend an overweight to North American versus European equities.”
Marco Pabst
Chief Investment Officer London at Union Bancaire Privée (UBP). Based in: London, UK
“March was an extremely volatile month as the implications of Russia’s military action in Ukraine became more visible across economies and financial markets. Stocks dropped significantly initially, only to recover as further escalation was contained. Commodity prices jumped as a result, further fuelling the already high inflation. The portfolio underperformed slightly last month due to its emerging market exposure, and no changes were implemented. Cash levels are still elevated, and to be deployed in the medium term.”
