Investec’s 18-month global investment outlook.
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The Global Investment View for Quarter 1 2019 distils the outcomes from the most recent meeting of Investec Wealth & Investment’s top strategic minds. Here, experts from the Investec Global Investment Strategy Group (GISG) offer their insights into the factors informing their risk positioning for the quarter, the medium term global outlook, how it will impact the South African economy, and what icebergs may lie ahead.
Read the latest investment insights for Q1 2019
Executive view of the quarter
The Global Investment Strategy Group (GISG) opted to increase its risk budget score to neutral, from the modestly negative position that had been maintained since December 2017. This improved outlook is based on the view that investor complacency has now evaporated, but that fears that either economic (monetary policy) or geopolitical miss-steps will bring the earnings growth cycle to an imminent end are now overdone.
We still see a supportive economic backdrop, with improved valuations, particularly in emerging markets. This gives us confidence that owning risk assets will be rewarded relative to owning cash or fixed income over our forecast period (18 months).
Global politics and economics
Iceberg and opportunities
Local politics and economics
Please bear in mind that these are personal views and opinions of the individuals, however in some instances, the “house view” has been expressed. The views expressed are subject to change, and no forecasts can be guaranteed. Past performance is no guarantee of future performance. In preparing this presentation, the presenters and the interviewees have made specific assumptions, without independent verification. Other or additional assumptions may lead to different conclusions. Actual results or events may differ materially from those projected, estimated, assumed or anticipated in these scenarios.
Investec Wealth & Investment engaged with Lindiwe Mazibuko at our request in order to obtain her independent view and insight.
From an asset allocation perspective, we had been up weighting domestic risk asset classes in a very measured fashion through the year, focussing on expected risk-adjusted returns.
Markets have been given ample time to adjust to the normalising US monetary policy stance and investors are aware that Europe has embarked on the same course.
The fall in equities in 2018 has meant that valuations have become less demanding.
About the author
Patrick writes and edits content for Investec Wealth & Investment, and Corporate and Institutional Banking, including editing the Daily View, Monthly View and One Magazine - an online publication for Investec's Wealth clients. Patrick was a financial journalist for many years for publications such as Financial Mail, Finweek and Business Report. He holds a BA and a PDM (Bus.Admin.) both from Wits University.
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