Embracing volatility

The abrupt reversal of equity markets in the last few weeks has sent shivers down investors’ spines, particularly as momentum was the dominant factor behind the rally that preceded it. Time to panic? On the contrary, history shows that buying into short-term weakness has been a fruitful strategy for long-term… Read the article

Like the ghost in Charles Dickens’s “A Christmas Carol,” recent price action in Japanese equity markets has been an unwelcome echo of the past. Outperformance of stocks with more stable earnings streams has resembled the market dynamics that provided a headwind to value investors in the decade after the financial… Read the article

US withdrawal from Paris Accord puts technology at the forefront of the climate challenge

As expected, and as promised during his campaign, US president Donald Trump yesterday announced that the US will withdraw from the Paris Climate Accord, the 2015 agreement setting greenhouse gas (GHG) emission reduction targets for individual countries. One of the major achievements of the agreement was the near universality of… Read the article

Low-volatility strategies are supposed to insulate investors from market bouts of turbulence. But lately, that’s been flipped on its head, as the strategies have underperformed and fund flows are retreating.

In the latest in our regular video series on the equities markets, Investment Director, Ritu Vohora provides an update on… Watch the video

China’s transformation over recent decades has generated some great investment opportunities. But the challenge for investors has always been how to reach them. For many years, overseas investors have been restricted to a limited selection of Chinese companies. That’s now changing. As part of the Chinese government’s drive to raise… Read the article

Is the healthcare sector really cheaper than consumer staples?

Superficially, the healthcare sector in Europe looks attractively valued relative to consumer staples, but on a cashflow basis the relative valuation argument disappears. This may reflect more aggressive earnings adjustments in European healthcare.

In the US though, the valuation gap between healthcare and consumer staples does look more real and… Read the article

Safe as houses?

Having been in the doldrums since the financial crisis, there are now tentative signs that the European residential construction sector is on the mend. We’re seeing encouraging data coming through and from our analysis and our discussions with companies, we’re increasingly confident that the earnings growth potential in the sector… Read the article

Improved Public Offerings

A regular feature of my life is trying to focus on an IPO (initial public offering) prospectus through sleepy eyes on the 06.35 from Colchester! Unfortunately the complexity of the IPO process often means that the key document  – called a ‘pathfinder prospectus’  – only turns up just before (or… Read the article

Retailers on the margin

Consumers are a demanding bunch. They want more choice, convenience and above all, a great customer experience. Yet they don’t want to pay more for the privilege! Satisfying the modern customer poses considerable challenges to today’s retailers. Can anyone but the consumer prosper in this environment?

Strong house price growth,… Read the article

I fondly remember “Don’t panic” being the catchphrase of Lance-Corporal Jack Jones in the popular 1970s sitcom Dad’s Army. ‘Jonesy’ would shout this loudly at moments of impending danger, while running round in a frantic panic himself.

While Jonesy wasn’t exactly the best Lance-Corporal, he would make an even worse… Read the article

A letter to Santa

Dear Mr Claus,

For much of its long history, your company has been shrouded in secrecy. Although your toy manufacturing and logistics business has been held in high regard by industry insiders for its innovative just-in-time distribution system, relatively little has been known about your financial performance. That all changed… Read the article

A response from Santa

Dear Mr Rinch,

Thank you for your letter, dated 16th December 2015.

Before I address the body of your letter, I must say this is not the first time I have defended the company’s business model against the myopia of market participants: long before our IPO, creditors Marley & Scrooge… Read the article

There’s life in the old fossil (fuels) yet

With Bank of England governor Mark Carney’s recent speech on fossil fuels and December’s UN climate change conference looming on the horizon, it’s not surprising the whole ‘stranded assets’ argument is gathering momentum. Warnings abound that investors and governments will face potentially huge losses if tougher action on climate change… Read the article