Giovanni Becchere
Head of Multi-Assets, ABN AMRO Investment Solutions. Based in: Paris, France
“With lockdowns across the world leading to a sudden stop in economic activity, the global economy will experience a large economic contraction with probably the most severe surge in unemployment ever. It is difficult to say when the outbreak will lessen and enable economies to start up again, but we expect it to happen later this year. We maintain the preference for equities versus bonds but within equity we reduce our exposure to value by selling AAF TCW US Equities and increasing the exposure to the other US equities holdings.”
Luca Dal Mas
Senior fund analyst, Aviva Investors. Based in: London, UK
“Markets reacted to the global spreading of Covid-19 by falling at a rate not seen since the 1987 crash. Measures implemented to try to contain the pandemic have followed a similar approach used by China earlier in the year and are expected to have a similar economic impact: a recession of unprecedented speed and depth. From a portfolio perspective, we reduced equity exposure across developed and emerging markets and switched some of the proceeds into more defensive market neutral managers.”
Kelly Prior
Investment Manager in the Multi-manager team, BMO Global Asset Management. Based in: London, UK
“February turned out to be the warm up for the main event of the first half of March which saw spectacular falls around global equity markets. There was nowhere to hide as both bonds and equities lost ground on the month as liquid assets were sold in haste. The TT Emerging Markets unconstrained fund was the worst performer of the selection, while the M&G (lux) Global Macro Bond fund lost the least. The latter fund swiftly shifted to take advantage of the bargains now available in risk assets. Q1 may be over but the volatility most definitely will not be.”
Gayathri Devarakonda
Fund Research Analyst, Deutsche Bank Wealth Management. Based in: London, UK
“Global equity and fixed income markets fell massively on fears of the virus spreading and what impact it would have on global economic growth and society. On the equity side, growth and quality-oriented equity managers mostly continued to outperform the broad market indices as well as their respective value-oriented peers. On the fixed income side, the higher beta sectors of the credit markets suffered most. The portfolio did reasonably well with the help of sovereign bonds and gold exposure. We made no changes to the portfolio.”
Silvia Tenconi
Multimanager Investments & Unit Linked, Eurizon Capital SGR. Based in: Milan, Italy
“In March, the performance of the portfolio was negative. All our funds were in the red. The best performers were Eurizon Fund Bond Short Term EUR T1, Eurizon Fund Absolute High Yield and Baillie Gifford Japanese Equity. The coronavirus has become a pandemic disease and all the world is trying hard to contain it. Authorities are also increasing support for the economy and the consumer to unprecedented levels. We reiterate our positive stance on developed equity markets and add some more US and European exposure to our portfolio.”
Richard Troue
Fund Manager, Hargreaves Lansdown Fund Managers. Based in: Bristol, UK
“Defence was the best form of offence last month. Equity and bond markets fell steeply and funds that looked dull for a few years came into their own, fully justifying their place in a balanced portfolio. Trojan, Pyrford Global Total Return, and Invesco Tactical Bond are in this camp. We’re seeing some evidence that countries hit first by the Covid-19 pandemic, including China and Italy, are coming through the other side. Some interesting opportunities are starting to emerge, but I still think it’s best to hold fast and wait for more evidence of improvement before making significant portfolio changes.”
Bernard Aybran
CIO Multi-management, Invesco. Based in: Paris, France
“In March, the balanced portfolio has been made more suitable to the current situation in financial markets and the broader economy. The only fund that has been fully sold had been properly managed but was investing in one of the less liquid areas of the markets. In the troubled times markets are going through, liquidity is one of the most precious features, hence the portfolio only retains the most liquid assets. The two other holdings to be trimmed, in both fixed income and equity, are also investing in less liquid areas of the markets.”
Paul Hookway,
Senior Fund Analyst, Kleinwort Hambros. Based in: London, UK
“As the coronavirus spread we took decisive action, significantly increasing cash and reducing equity and fixed income exposure. H20 Multi Aggregate was removed; it had suffered in the downturn and we decided to book our profits. We added a new holding of Neuberger Berman Short Duration Emerging Market Debt and increased government bond exposure. In equities we reduced the US exposure and in Europe sold the holding of JO Hambro Continental European, preferring to retain Blackrock Continental European Flexible in current market conditions.”
Antti Saari
Chief Investment Strategist, Nordea investments. Based in: Copenhagen, Denmark
“March has seen one of the fastest drawdowns in the history of equity markets followed by a rally, but the worst is still ahead of us in terms of economic and earnings data. However, the market has already priced in significant weakness, likely to be degrees worse than can be seen from analysts’ estimates. In the same vein, more easing is still likely in case it is needed. Thus, we expect the balancing process to continue to produce wild swings in the markets, which is why we recommend a neutral allocation to equities.”
