020 7189 9999
Opening hours
Mon - Fri: 7.45am to 6pm (Thurs 8pm)
Sat: 9.30am - 1.30pm
Request a call back
  • Home
  • News
  • Economic overview and summary of our asset allocation decisions – December 2016

Economic overview and summary of our asset allocation decisions – December 2016

Economic overview and summary of our asset allocation decisions – December 2016

November was a dramatic month in the world of politics, which had an effect on markets. The election of Donald Trump as the 45th US president, like the Brexit vote, proved the pollsters wrong and led to a sharp rotation in global markets. While there is still a great deal of uncertainty surrounding whether President-elect Trump will be willing (and able) to deliver some of his campaign pledges, talk of a fiscal boost to economic growth through infrastructure spending and tax cuts dominated market sentiment for much of November.

Our view – asset allocation summary

  • At its November meeting the Asset Allocation Committee decided to reduce exposure to US Treasuries in the centralised models, with an increase in the allocation of absolute return and short-dated investment grade credit
  • Our overall asset allocation strategy remains in place and there has been no significant change to the house view – Central banks are now clearly approaching their limit in terms of their ability to stimulate markets, imperilling valuations, and while fiscal policy may provide some boost to global economies and inflation, it may not help asset prices
  • Following the US presidential elections, an accelerated fiscal stimulus package is now expected, which is likely to put pressure on US Treasuries. As a result, we have taken profits from US Treasuries and looked to redistribute the proceeds into areas which match our house view of caution and mitigate downside risks
  • Following fresh falls in sterling and under-appreciated risks to the euro, we are also now seeking to hedge out euro currency exposure

VIEW MARKET COMMENTARY

I hope you have found this update helpful. Please do get in touch if you have any queries or would like more information.

The value of your investment can go down as well as up, and you can get back less than you originally invested.

The Bestinvest Online Investment Service, including any account analysis and investment reports provided by our guidance services, is an online execution-only dealing service for investors who want to make their own investment decisions. It does not provide advice on the suitability of products and investments; if you are unsure about the suitability of any investment you should seek professional advice. Clients of our Investment Advisory Service and Managed Portfolio Service can use the website to obtain current valuations of their investments but cannot trade on these accounts online and should call their adviser if they wish to discuss changes to their investments.

Past performance or any yields quoted should not be considered reliable indicators of future returns. Restricted advice can be provided as part of other services offered by Bestinvest, upon request and on a fee basis. Before investing in funds please check the specific risk factors on the key features document or refer to our risk warning notice as some funds can be high risk or complex; they may also have risks relating to the geographical area, industry sector and/or underlying assets in which they invest. Prevailing tax rates and relief are dependent on your individual circumstances and are subject to change.

Issued by Bestinvest (Brokers) Limited (Reg. No. 2830297), which is authorised and regulated by the Financial Conduct Authority. Financial services are provided by Bestinvest (Brokers) Limited and other companies in the Tilney Bestinvest Group, further details of which are available here. This site is for UK investors only.
© Tilney Bestinvest Group Ltd 2016.

Version: RC1027.44113