US Elections

A Biden presidency: reasons for cautious optimism

Head of Multi-Asset Income, John Stopford, explains why a Biden presidency combined with prospects of a vaccine in 2021 provide grounds for investors to be cautiously optimistic.

Nov 13, 2020

John Stopford

The fast view

  • Investors were positioned cautiously before the election, with a Democratic sweep likely to result in a range of more radical policies, including tax rises; this is now unlikely with a Republican Senate
  • Coupled with encouraging news regarding Pfizer’s vaccine, that caution has been replaced with widespread optimism, resulting in the positive for risk following the election
  • The last four years has seen very narrow leadership, primarily coming from the US tech giants; Biden’s more outward-looking perspective may change that
  • We are positioned cautiously, but for a relatively positive outcome for global markets, and are more bullish on currencies such as the yen, and non-US equities

General risks

The value of investments, and any income generated from them, can fall as well as rise. Where charges are taken from capital, this may constrain future growth. Past performance is not a reliable indicator of future results. If any currency differs from the investor’s home currency, returns may increase or decrease as a result of currency fluctuations. Investment objectives and performance targets are subject to change and may not necessarily be achieved, losses may be made. This is not a buy, sell or hold recommendation for any particular security.

Authored by

John Stopford
Portfolio Manager

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