Capital Group sees 2015 as an opportunity for investors in need of growth and sustainable income.
Despite headwinds from geopolitical unrest, rising rates, a mixed growth picture and the threat of Ebola, Capital Group continues to see attractive opportunities based on a selective, long-term investment approach
Seek global growth
US – Accelerating growth, an improving employment picture and benign inflation provide a favourable backdrop for continued investment. But after five years of solid gains, investors should temper expectations and expect volatility.
Global – It’s about companies, not countries. Europe and Japan face muted growth prospects, but currency weakness and falling energy prices could provide an earnings tailwind for attractively valued export-oriented businesses.
Emerging markets – Returns may have lagged the developed market, but demographic and economic trends together with attractive valuations provide opportunities for selective long-term investment.
Pursue sustainable income
Dividends – The global dividend opportunity continues to broaden, and although conventional wisdom suggests rising rates are bad for dividend stocks, a closer look shows growers and payers faring well when rates tick up.
Bonds – With the Fed signalling a rate increase, the bond market faces a challenging road ahead. But bonds can continue to provide needed diversification in uncertain times.
Emerging Market Bonds – Emerging market bond yields continue to offer relatively attractive valuations against a backdrop of low interest rates and accommodative monetary policy.