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Investment expertise

Monthly Investment Outlook

Monthly Investment Outlook

We publish a Monthly Investment Outlook that highlights our convictions on equities and bonds, as well as recent asset allocation changes.


  • GLOBAL TACTICAL ASSET ALLOCATION - Risk management is key
  • UBP ECONOMIC OUTLOOK - Tail risks still weigh on a moderate growth cycle
  • UBP ECONOMIC OUTLOOK - A new global monetary easing cycle beginning
  • GLOBAL EQUITIES - An adverse economic scenario still not priced in
  • GLOBAL BONDS - Opportunities to lengthen US duration have emerged
  • RECENT VIEW CHANGES - Adding US duration

  • US and ECB communications revealed divided opinions on the prospect for more aggressive stimulus looking ahead despite stress in US money markets. As a result, investors may face a ‘gap’ between limited monetary policy support and emerging fiscal support in mid-2020 in Europe and again in 2021, post-US elections leaving the prospect of renewed volatility for markets in 4Q19.
  • Admittedly, a thaw seems to have emerged between the US and China following China’s willingness to license 5G leader, Huawei’s techonology for American use. Though volatile, a road ahead appears to be taking shape in Brexit negotiations with a UK election likely to be a prelude to a more durable solution.
  • As a result, we continue to believe that an asymmetric approach is the anchor for investor portfolios until fiscal momentum emerges later in 2020. With volatility accelerating in equities, fixed income and precious metals markets over the past year, investors should expect this broadening bull market in volatility to continue into the year-end.
  • Money market instability in September raises the risk of a liquidity scare in markets like that seen in 4Q18. As a result, a quality, hold to maturity bias with a reasonable cash cushion in fixed income portfolios is preferred.
  • We have reduced positions in long-duration EM fixed income maintaining short duration EM positions in portfolios. USD and EUR corporate credit spreads have tightened. Central bank action should arrest sustained spread widening; however, volatility should rise. Opportunities to lengthen US duration have emerged to cushion against liquidity scare risks.
  • 2019 corporate earnings expectations continue to drift lower. However, as 3Q19 earnings season begins, attention should shift to 2020 earnings expectations which remain overly optimistic. Fortunately, investor sentiment is still cautious unlike in 2Q19 ahead of the May declines.
  • With total return expectations limited across many asset classes and with volatility still compressed in forex markets, we expect FX to emerge as an important, incremental return driver looking ahead. Moreover, with the rally in precious metals, we believe an opportunity exists to diversify risk-off exposure in portfolios via JPY and CHF positions.
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Investment Outlook 2019

A look back on UBP's Investment Outlook

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