Private equity will play a more prominent role in the construction of portfolios, with characteristics of traditional defensive asset classes put to the test and volatility becoming a feature of public markets.
There is little doubt that the combination of support and stimulus measures has helped the economy by maintaining consumption and spending, writes Roger Montgomery. Less certain, however, is whether the current level of fiscal support will continue.
If the US printing of money was helping to finance military or economic domination it would make more sense than what the printing of money is being used for, which is to buy the bonds of, and support low interest rates for, rubbish, Triple C-rated, junk companies - Roger Montgomery writes.
Despite the capital outflows emerging markets have more room for both fiscal and monetary stimulus compared to developing markets and will benefit from the supply chain diversification will follow Covid-19.
Advisers should pause before thinking about selling positions in heavily discounted portfolios and be wary of the 'buy the dip' narrative many equity funds managers are peddling, Oreana's CIO Isaac Poole said.