Investment Outlook 2017

At True Potential, we partner with some of the world’s best known fund managers. We ensure UBS, Goldman Sachs, Allianz, Schroders, SEI, Seven Investment Management, Close Brothers and Columbia Threadneedle have a clear goal: to help you reach yours.

We asked our fund manager partners for their predictions for the year ahead and where they believe the best potential for returns may be. These opinions will change and evolve over time and should not be taken as advice.

Which asset class do you think will perform best in 2017?

Uncertainty over how the UK’s departure from the EU will play out is prompting managers to favour overseas markets. Any recovery in Sterling is likely to make UK equities more expensive for overseas investors and this is also undermining confidence while the prospect of rising interest rates, globally, has made bonds around the world unpopular.

Which equity market will be most popular among investors in 2017?

As Central Banks around the world begin to withdraw liquidity from global markets, attention will once again focus on traditional growth drivers. With stronger growth, less debt and healthier demographics the Emerging Markets are regarded as offering the greatest potential for growth, albeit with higher levels of volatility.

Which type of bond do you think will perform best in 2017?

The United States has already edged up interest rates which in turn has fed through to dollar denominated Global High Yield and Emerging Market bonds making them more attractive than jurisdictions where interest rates remain at depressed levels.

Which type of investment style do you think will perform best in 2017?

With real growth being harder to come by in the years ahead, investors are turning to ‘Value’ situations, those unloved companies that may have underperformed for one reason or another, where they perceive a clear gap between the intrinsic worth of a company and the value placed upon it by the stock market. Conversely, the large, multinational, blue chip companies that benefitted most from the Quantitative Easing cash injection are seen as potentially vulnerable as this monetary stimulus is gradually withdrawn.

For further updates throughout the year, visit our blog every Friday for our weekly Economic Update written by our Investment Managers.

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