Staying active: how to regain trust in active management
We asked 500 institutional investors their views on active management. The results offer a roadmap for active managers to help clients navigate challenging markets - and rebuild trust in active management.
Fed moves can't erase economic uncertainty of coronavirus
The US Federal Reserve cut rates to near zero over the weekend in a bid to ease pressure on the global financial system. Yet stockmarkets are unlikely to be reassured. With the course of the coronavirus outbreak uncertain and governments acting increasingly aggressively to contain or delay its spread, a global recession looks all but certain. Investors should recognise that we are in bear-market territory and adjust accordingly. US Treasuries and gold could do well, but investors may also want to add risk in undervalued sectors such as energy.
What’s unnerving for markets is that the full downside risk of the coronavirus is difficult to quantify. And it comes when the world economy is facing a downturn, central banks have little policy ammunition left and global leverage is again at record levels. While there are typically several conditions that signal when a bear market in risk assets has come to an end, we don’t think all these conditions have been met. Investors should, therefore, remain cautious as the economic effects of the coronavirus continue to spread.