OBSR remains neutral stance on equities in latest asset allocation view
Market volatility means that despite share price falls equities still face a possible downside, while yields from fixed income could remain low for a while yet, according to OBSR’s latest monthly global investment strategy summary.
There is little to cheer about across any of the main asset classes considered by summary research author and investment strategist Andy Brunner.
“Even after a 12% or so fall in equity markets risks remain elevated and further high levels of volatility are still probable,” he writes.
And the outlook for other assets is not much more cheeful, according to excerpts of his views: “With main market government bond yields at such low levels, it makes little sense to increase weightings unless a recession is expected……after such a strong yield impact-led recovery in capital values the pace of advance in the UK property market has slowed to a crawl….predicting commodity returns is normally difficult enough given the very broad spread, high volatility and problems associated with rolling over futures contracts on returns…near term [currency] trends will depend on the authorities’ response to current financial turmoil but the Swiss franc and yen are unlikely to strengthen too much further given counteracting flows from the respective central banks.”
To reach the full summary click here [asset_library_tag 3419,September 2011 Summary].