Investment Line is a regular investment bulletin produced by Mattioli Woods plc. The communication provides an update on funds, highlights some of the areas we are currently focusing on, and our thoughts on the issues of the day.
We do not feel the time is yet right for comprehensive risk reduction across portfolios, but we are going to be trimming US exposure.
We will be reducing US exposure on a range of concerns. Other markets exhibit vulnerabilities too, but valuations have not reached the same levels as they have on Wall Street and should hold up for now.
More division in May’s Cabinet hardly inspires confidence, but there remain attractive opportunities especially further down the market cap spectrum.
Our lack of belief in the case for global growth means portfolios heavily feature specialist allocations where we feel companies can benefit from key themes in the investment universe and are likely to grow irrespective of wider macro-economic developments. Current allocations are working well.
No changes for now. Interest rates look as if they are going higher, but the moves should be very gradual.
We are holding overall allocations for now, continuing to focus exposure on closed-ended funds and regional property, expecting the income to be most of our return in 2017.
Our absolute return allocations are a reflection of poor returns on cash and high valuations in conventional investment areas. The allocations will be used selectively as and when we see compelling opportunities, though nothing falls into this category at the moment.
We are adding to cash using the funds raised from the US and will deploy them once an attractive opportunity presents itself, which may yet be sooner rather than later.
Investment Line is written and edited by members of the Mattioli Woods Asset Allocation Team, and is for information purposes. It is not intended to be an invitation to buy, or act upon the comments made, and all/any investment decisions should be taken with advice, given appropriate knowledge of the investor’s circumstances. The value of investments and the income from them can fall as well as rise, and investors may not get back the full amount invested. Past performance is not a guide to the future.
Mattioli Woods plc is authorised and regulated by the Financial Conduct Authority.