19 April 2018: Seeking direction
– Year to date, global equities have experienced 17 days with a greater than 1% move up or down, versus just three in 2017. Yet stocks are roughly flat year to date.
– Choppy trading conditions reflect geopolitical tensions, including conflict in the Middle East, and the threat of a global trade war, as well as the risk of accelerated monetary tightening.
– Over our six-month investment horizon we expect stocks to advance and outperform high grade bonds, thanks to sound economic fundamentals. But higher uncertainty means we also hold diversified counter-cyclical positions.
– We take profit on our overweight GBPCHF position, and close our emerging market currency basket trade, while keeping some of these investments in the portfolio.