In its Panorama Outlook, UBS Asset Management looks back at what happened in the financial markets in the first six months of 2021.The asset manager also outlines what investors should look out for in the second half of this year.
Macro-specialists Evan Brown and Ryan Primmer dive into global economic topics. They expect inflationary pressures to ease in the second half of this year in the US. In addition, they do not think that the ECB will suddenly reintroduce strict fiscal rules for its member states and that the buy-back programme will be phased out amid rising inflation. The investment experts also do not expect the European economy to embark on a real growth spurt before 2022, mainly because the service sector is slow to pick up steam. Nevertheless, Brown and Primmer expect the share prices of European companies to be higher than those of American companies.
Furthermore, Asia investment experts Hayden Briscoe, Geoffrey Wong and Vivien Ng elaborate on Asian economic expectations and how important China has become for the prosperity of its trading partners. Does the whole concept of 'emerging markets' still exist now that it has become mainstream to invest in these countries?
The Panorama also focuses on hedge funds. UBS AM believes that the time is ripe for investors to increase their allocations to hedge funds. This is mainly because allocations in recent years have gone to alternatives at the expense of hedge funds. But now that prices are rising, chasing alpha rather than just beta, which has long had the wind in its sails, is probably not a bad idea.
In addition, there is a preview of a new white paper being worked on by the Data Science team and Bruno Bertocci, Head of the Global Sustainable Equities team. It explores a concrete way in which UBS AM companies and clients can model the cost of their C02 footprint in their investments and valuations. This will also form the basis of how UBS AM engages with clients about this topic.
Here you'll find the complete mid-year Panorama from UBS Asset Management.