Investment Line: our current thinking on asset allocation - September 2023

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 focusing on, and shares our thoughts on the issues of the day. 

21 September 2023
2 Minutes


The US economy looks robust but the valuations of the stocks which have led its stock market this year create a high degree of risk for investors. We continue to prefer a selective approach here and reduce US allocations in favour of global equity income and energy in some portfolios, maintaining some US exposure but more specific than broad based.


The UK has perhaps been more robust than some had feared but economic challenges remain. We do however see excellent long-term value in the UK equity market and allocations remain healthy; investors need to look beyond some of the economic concerns.


We are introducing a specific energy allocation to some of the portfolios having previously used it only for the most adventurous investors. The long-term supply issues caused by underinvestment, geopolitical tensions and the hedge it offers against inflation make for a robust investment case, even allowing for the effects of a global downturn. We add to physical gold in some lower risk portfolios on expectations of more stress in the global financial system and potential upheaval in markets.


We continue to focus on high quality bonds. Our sovereign exposure remains exclusively in US Treasuries though we are discussing the addition of gilts to provide diversification.


Valuations justify holding allocations though patience may be required for some time yet.


We have a small range of options we like, which bring an extra dimension to portfolios. The environment has posed challenges even for ideas in this space.


Slight reduction to accommodate gold lower down the risk spectrum but generally unchanged. Cash is a good discipline for investors, and we are at least paid now.


Click here to read our thoughts on the current market.

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Investment Line is written and edited by Chief Investment Officer Simon Gibson and Investment Strategist Richard Smith 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 go down as well as up, and you may not get back the amount invested. Past performance is not a guide to future returns.

All content correct at time of writing. 

Mattioli Woods plc is authorised and regulated by the Financial Conduct Authority.

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