The fast view
- For perhaps the next decade, it may be challenging for investors to generate returns from traditional equity or bond allocations. The Global Macro Allocation strategy aims to provide a solution.
- We use a thematic 5-10-year horizon macro framework to identify areas with significant tailwinds (or excess growth). Then, we look to buy companies and assets that are beneficiaries of those tailwinds.
- We adopt a flexible, unconstrained approach. We exploit a very large opportunity set across all the liquid spectrum of asset classes, particularly equities, fixed income and currency, so we can find opportunities across the market cycle.
- Our approach is counter-cyclical. When investors are becoming more excited, prospective macro weakness is emerging and valuations are extended, we will seek to reduce risk within the strategy. When there is pessimism, valuations are cheaper and the prospective macro environment is improving, we will look to allocate capital into our longer-term investment ideas.
All investments carry the risk of capital loss
Specific risks
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of investments and any related income. Derivatives: The use of derivatives is not intended to increase the overall level of risk. However, the use of derivatives may still lead to large changes in value and includes the potential for large financial loss. A counterparty to a derivative transaction may fail to meet its obligations which may also lead to a financial loss. Equity investment: The value of equities (e.g. shares) and equity-related investments may vary according to company profits and future prospects as well as more general market factors. In the event of a company default (e.g. insolvency), the owners of their equity rank last in terms of any financial payment from that company. Concentrated portfolio: The portfolio invests in a relatively small number of individual holdings. This may mean wider fluctuations in value than more broadly invested portfolios. Emerging market (inc. China): These markets carry a higher risk of financial loss than more developed markets as they may have less developed legal, political, economic or other systems.
General risks
All investments carry the risk of capital loss. The value of investments, and any income generated from them, can fall as well as rise and will be affected by changes in interest rates, currency fluctuations, general market conditions and other political, social and economic developments, as well as by specific matters relating to the assets in which the investment strategy invests. If any currency differs from the investor’s home currency, returns may increase or decrease as a result of currency fluctuations. Past performance is not a reliable indicator of future results. Environmental, social or governance related risk events or factors, if they occur, could cause a negative impact on the value of investments.
