When the world’s most powerful asset-management firms talk, I listen. Every day, they’re managing hundreds of billions of dollars. From mum-and-dad pensions through to institutional mega pots.
Sometimes their sheer size makes it difficult for them to exploit opportunities — but they can still sway the market. How these companies will deploy cash over the next six months will help decide the fate of the market.
UBS is among the largest, running over USD $600 billion. They have over 7,000 wealth managers in the US alone.
At the higher end of money management is their Private Wealth arm. Here’s what Julie Fox, MD at the newly formed Mid-Atlantic Private Wealth Management hub of UBS, had to say. On current market conditions:
‘We think earnings are likely to recover in the second half of the year and excess liquidity will continue to support risk assets…We see further potential in global equities and think there’s some upside in segments of the market that have underperformed during the crisis.’
Other major fund managers seem to echo her sentiment. Seeing ‘multi-year recovery’, alluding to government and central bank cash flood measures. Though admitting there will be ‘wobbles along the way.’
I tend to agree with this risk sentiment. Things have not been as bad as the mid-March lockdown sell-off signalled. Even without a vaccine, we are learning to live and trade through coronavirus.
By definition, some of the biggest gains will come not from the companies that have withstood lockdowns. But rather those who have suffered, some to the very brink of their existence.
Which is why I’m moving our latest exclusive stock pick from our Watch List to our portfolio monitoring. Here’s why it’s so significant…
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