Last year was a challenging year for investors, with US equity and government bond markets both returning less than cash. While there is no guarantee of better performance in 2019, identifying the underlying causes gives investors an opportunity to manage these investment risks.
Keith Wade, Chief Economist & Strategist at global asset manager Schroders, believes poor global growth and tighter liquidity will continue in 2019 with the decline of cheap money, the reappearance of emerging markets and the many governments turning to quick fix policies to quail populist demands.
Wade believes that being aware of these risks allows investors to be better prepared. “How are these themes likely to shape market performance in 2019? Much of the bad news is already priced in by the markets. This, of course, is no guarantee of positive returns in 2019, but it does mean that markets are better positioned for disappointment and hence potentially more resilient to shocks than they were last year”, he mentioned.
He says that while there is no guarantee of better performance in 2019, identifying these important themes gives investors an opportunity to manage these investment risks.
Click here to read more about the three themes.
