Last week I wrote about the apparent confusion caused in some quarters by strong stock returns against a backdrop of weak macro and profits data. I argued that two important reasons behind this were the removal of rate pressure, and the unwind of the episode at the end of… Read the article
Yesterday the US equity market (S&P 500) reached all-time highs. Indeed so far in 2019, many major equity markets are up between 10% and 20%.
This has caused much confusion; it runs contrary to what seems to be a very negative backdrop for the global economy, with warnings… Read the article
For those of us who weren’t around during the dot.com boom and bust, this period can seem like an historical oddity. It’s often used as a classic example of the foolishness of human beings and the ability of markets to make blindingly obvious mistakes.
From the vantage point of hindsight… Read the article
In spite of trade-war driven volatility in May, market behaviour in many major regions during the second quarter was characterised by positive returns from both equities and bonds (with Japanese and other Asian equity weakness a notable exception):
We’ve discussed… Read the article
Sometimes the market is seen as an almost mystical force, sending signals that give us special insights about the future if only we can decipher what it’s ‘telling us.‘
Other times it’s characterised as a naïve and careless basket case,… Read the article
Last month Joe Wiggins noted that fund managers frequently claim to make money by exploiting the ‘behavioural biases of other investors,’ but are often unable to explain how they avoid falling victim to these biases themselves.
Now it could be that ‘exploiting behavioural bias’ is simply… Read the article
You may have seen charts like the one below before (possibly here or here) which suggest that investors and commentators find more to worry about than they really should:
This certainly seems to have been the case for bulk of… Read the article
In 2018, almost all major asset class categories delivered negative returns:
So far in 2019, almost all major assets have done the opposite:
This degree of correlation is unusual. Some described last year as the worst on record in terms of correlated… Read the article
Our sense at the end of 2018 was that the volatility being seen in markets at that time was episodic in nature. Yes, there were things to be worried about from a growth standpoint, but the rapidity and nature of price moves suggested that… Read the article
Earlier this week the IMF released its latest economic outlook. It was the debut of the newly appointed and first female IMF chief economist, Gita Gopinath.
She observed that “While global growth in 2018 remained close to post crisis highs, the global expansion is weakening”. Indeed, the… Read the article
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OKWelcome to the M&G Multi Asset Team’s Allocation blog, previously known as the Episode blog. We have changed the name of our blog to resonate better with our readers in Europe, however, the content and purpose of the blog has not changed. The Allocation blog continues to aim to provide unique market perspectives from our dedicated team of experienced asset allocators.
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