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Dear Reader,

This month's Feature article is focused on trade, and the concern that the recent US tariffs could lead to an escalation of trade frictions. Although we don't expect these frictions to escalate into a full-blown trade war, the complexity of possible reactions has created increased uncertainty and angst.

Investors looking for ways to deal with uncertainty should consider gold and silver, which tend to perform well during market crises and should benefit as strong economic growth produces rising inflation expectations. See our Top Themes Spotlight section for more information.

In this month's In Context video, we explain why we've decided to close our long-standing overweight to the technology sector, even though we still expect strong earnings growth. We also discuss why we've decided to reduce the size of our underweight to utilities, which has underperformed the S&P 500 by nearly 20% in the last 6 months.

Although we expect the bull market to endure, this remains a challenging environment for investors looking to generate income. With interest rates still very low across the globe, investors seeking higher yield may be taking on risk that is not adequately rewarded. With this in mind, the Wealth Management USA Asset Allocation Committee has introduced a new suite of House View Yield-Focused portfolios based on CIO research (PDF, 864 KB), designed to provide higher income without sacrificing long-term total returns or taking excessive risk. These appear along with the previous Strategic Asset Allocation portfolios beginning on page 23 of the House View: Investment Strategy Guide. Contact your UBS Financial Advisor to discuss whether these portfolios can be useful as a tool in meeting your family’s financial goals.



Mike Ryan, CFA

Chief Investment Officer Americas

UBS Global Wealth Management

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