Current views at a glance - November 2017






There are concerns over ongoing economic strength in light of Brexit overhang and that the tailwind from weaker sterling may be in the past



We are seeing strengthening economic activity and believe equity markets are relatively undervalued, but we are expecting a pause


North American

A fuller valuation is offset by weaker USD and good earnings growth



A better global economy is helping Japan but the domestic economy is still disappointing


Asia Pacific

The pick up in global trade is helpful to Asia Pacific


Emerging markets

Modest but synchronised global growth should be more supportive to Emerging Markets


Fixed income


Government bonds

We remain negative on GBP and euro bonds but US Treasuries are becoming more attractive given the normalisation of yields that has taken place


Investment grade

Credit spreads has provided some pick-up but we prefer short-dated bonds



High-yield credit spreads are at a historically tight level so we would be wary of high-yield spread duration exposure



Recent gains in inflation-linked government bonds reduce their valuation attractiveness but they are still desirable from an improving economic perspective


Emerging market

Selectively, local emerging market bonds offer good interest rate and currency exposure




Absolute: equity

Increased volatility and dispersion should provide opportunities


Absolute: fixed income

Lower liquidity and flatter rate profiles reduce the attractiveness of many strategies


Absolute: macro

Increased volatility across many asset classes should counter flatter rate cycles



Post-Brexit concerns have resulted in the marking down of property but income characteristics are still attractive 


Precious metals

Gold is attractive as a diversifier, portfolio insurance and as an inflation hedge


Industrial metals

Ongoing excess supply is likely to weigh on prices for some time



Oil continues to be volatile as politics and supply concerns dominate the market





Cash has defensive and opportunistic qualities in uncertain and volatile markets


This article is issued by Cazenove Capital which is part of the Schroders Group and a trading name of Schroder & Co. Limited, 1 London Wall Place, London EC2Y 5AU. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. 

Nothing in this document should be deemed to constitute the provision of financial, investment or other professional advice in any way. Past performance is not a guide to future performance. The value of an investment and the income from it may go down as well as up and investors may not get back the amount originally invested.

This document may include forward-looking statements that are based upon our current opinions, expectations and projections. We undertake no obligation to update or revise any forward-looking statements. Actual results could differ materially from those anticipated in the forward-looking statements.

All data contained within this document is sourced from Cazenove Capital unless otherwise stated.