Investment Outlook Q2 2011
This is available to download as a PDF here.
We publish this document once a quarter to record the conclusions of our formal Investment Committee process. This process enables us to make tactical changes to the asset allocation models we use as the basis for our investment recommendations to clients.
Within this report we have made several changes to our House View, to reflect current economic and market outlook.
We have cut our exposure to UK Index Linked Gilts, with the valuations of these assets remaining relatively unattractive and signs that prices could start falling soon.
We are also moving from an underweight to a neutral position for European Equities. Despite the news about the Portugese call for financial support this morning, there are some positive economic indicators coming out of Europe and attractive valuations for European companies.
Whilst some fund managers and investors used the recent events in Japan as a buying opportunity, we are maintaining our underweight position for Japanese Equities, as we believe the outlook for Japan remains too uncertain at this time.
Another tactical decision we have made this month is to cut our exposure to Emerging Market Equities, with China and Brazil starting to look too expensive and better ways to access to the Emerging Market economies growth theme.
For the first time this quarter we have included the views of a fund manager within the report. Richard Woolnough from M&G has shared with us his current sector outlook for UK Corporate Bonds. We aim to feature more exclusive fund manager views in our Investment Outlook reports in the future.
We hope that you find this report interesting and useful, and we always welcome your feedback. You can leave your comments here or get in touch if you have any questions.
Edit: Version two of the report, which can be downloaded here, now contains exclusive commentary from Adam Avigdori, manager of BlackRock UK Income.