The impending United Kingdom referendum on European Union membership remains a major “event risk” for global markets over the coming month. That said, polling suggests the chances of the UK leaving the Union after this vote are diminishing, which means there might be scope for at least a short-term “relief rally” for the British Pound. More broadly, however, it’s worth noting that UK equities have underperformed their continental counterparts in recent years, and lingering concerns over the UK’s commitment to the European Union suggests investors might consider European investments that exclude the United Kingdom.
BetaShares currently runs three Managed Risk Equity Funds. These funds employ a systematic, rules based risk management strategy, which seek to control volatility and defend against market losses. Since the launch of our first managed risk fund about 18 months ago, total assets in our Managed Risk suite recently surpassed $200m.
I don’t understand asset allocation in any but the simplest of terms. Could you explain to me why I should allocate across different asset classes and regions?
The recently released minutes to the Reserve Bank of Australia’s May policy meeting – at which it cut official interest rates – highlighted the fact that it was near-term downside risks to inflation, not economic growth, that encouraged the Bank to act. Given the challenge of pushing underlying inflation back up, it seems likely that the RBA will cut interest rates at least once more this year. Ultimately, however, this is a very pro-growth development which could usher in a return to above-trend economic growth and better stock market performance.
When speaking to advisers about ETFs, there seems to be a view from some advisers that ETFs are purely tools for timing current market conditions. I would like to take some time in this blog post to hopefully dispel this idea.
The Reserve Bank of Australia’s decision to cut the official cash rate last week – together with growing expectations it will cut interest rates further – has thrown the spotlight back onto yield plays in the Australian equity market. Although financials have faced bearish investor sentiment in recent months, their still attractive yields and relatively cheap valuations suggest they remain an investment worthy of serious consideration.
The Australian exchange traded fund industry hit a new record of $21.9 billion in total funds under management (FUM) during April. Reflective of both the recovery in the local equity market and the changes to interest rates, broad Australian equities and fixed income products received the highest level of inflows.
I am trying to carefully build a nest egg.
I understand I need to be at least partially invested in a diversified portfolio of stocks, but I find the level of volatility… uncomfortable. I’d like to at least reduce the level of volatility a bit, even if it means giving up a bit of return.
Risk markets extended their gains in April, though hedged global equities posted a more modest 0.8% gain after a very strong 5.3% rebound in March. The star performer last month, however, was commodities which rose 6.6% with broad based strength across oil, grains and gold.
Watch this short video for a description on the concept of Managed Risk Investing, and explanation on its applicability particular to retiree and pre-retiree investors.