Worry or not to worry, that’s the question! And the question is answered, but the answer depends on whom you are asking.
- In a 24 page long special Deutsche Asset Management guides us through the world of Oil. Main question after the sharp decline of the oil price is: Are markets right to worry that a low oil price is bad for the world economy? The short answer to this question according to DAM is clear. Don’t worry. For the long answer just click on the link.
- According to KBC in “Storm op de beurzen” there are five developments that make investors nervous: China, Oil, Oil Companies, US Economy and FED policy. On each development their message is more or less the same. Things are not as bad as they look. Be patient and stick to your guns. The market is overreacting.
- Russ Koesterich from BlackRock seems to worry a little more than the colleagues from DAM and KBC. As the title of Midwinter Forecast: More Volatility Ahead already suggest he thinks that “the elements are in place for continued volatility”. He suggests to look for strategies that minimize downside risk.
- In Oil price and equities: don’t trust their correlation AXA shows a 10 year graph of the correlation between oil and equity (MSCI World index) prices. The correlation is mainly positive. But they argue that this positive correlation is not robust (but maybe just a little stubborn in the short run).
- Pioneer expects the US Dollar bull market to continue in 2016. For this they state four reasons. Divergence in G-4 monetary policies, Fed tightening, a more market oriented RMB exchange rate and EM deleveraging.
- For the coming year Standard Life Investments is expecting continuing financial volatility, and they suggest investors to be highly selective in their asset allocation decision. You can take a look at theirs in Global Outlook February 2016.
- There is so much interesting material to read, where to start? The author of the Novus Guide of Crowding is pretty clear on this subject. “If there is anything you read this month, read this practical guide to the most relevant factor moving your portfolio today”. So of course that’s what we did. If you want to know why Crowding is an Important Risk Factor, we suggest you do the same.