Results for search of category: Commercial Property

Lost in Translation

There is a fundamental conflict between the bearish sector stance of our Chinese equity sector model and the bullish positioning of the US model. We don’t think it is possible for these two sets of sector recommendations to remain unchanged without having an impact on each other or the rest of the global equity universe. On balance we think it is more likely that the US will come to resemble China, rather than the other way around.  [Read More... ]

Not Another Brexit Preview

Suddenly the opinion polls say the result is too close to call. There are a whole series of consensus trades which investors are using to manage risk. We agree with most of them, but we would also be prepared to look at EM Equities, once we had done all the other safe haven trades. We don’t believe there will be a sustained rally in UK Commercial Property or in Financials if the “Remain” campaign is victorious. Nor do we believe in endless volatility and economic disruption if there is a vote to Leave.  [Read More... ]

It’s Not Just Brexit

Brexit is the lazy explanation for everything that is happening in the UK. The vote is important and will be close, but other forces are at work. The commercial real estate market may be peaking. Historically this has always been a problem for the UK economy.   [Read More... ]

Cooler on Real Estate

Earlier this month we downgraded UK Commercial Property to Neutral against a 50/50 portfolio of UK equities and bonds. At the time everyone was obsessed with the upcoming General Election, but it is now time to go through our reasons and draw some parallels with the USA, where we are already Underweight.  [Read More... ]

Put Away Your Telescope

We start the New Year with a polite request to all our readers. Please stop trying to forecast events which are 12 months away and spend more time trying to understand what financial markets are telling you about today. Investor attitudes to risk, not consensus forecasts, will be the key driver of returns this year.  [Read More... ]

Currency Crisis

Last week we published a note with the title “It’s Too Darned Quiet”. Then everything went crazy on Friday. This now looks like a generalised currency crisis, brought on by a combination of falling oil prices and the withdrawal of QE. Possible repercussions may include a Chinese devaluation and Hong Kong property crash, a stronger euro than forecast, and underperformance by the Financial and Tech sectors in the US.  [Read More... ]

Second Order Explanations

Following this week’s downgrade in the Eurozone, the Financials sector is rated Underweight is every region. We cannot detect any single, all-powerful explanation for this, unlike the Energy sector - at the top of the rankings - where there an obvious unifying factor (geo-political risk). This makes us more concerned, not less, because we are not sure what the market is trying to tell us.  [Read More... ]

Day in the Sun

UK Commercial Property looks set to produce much better income growth than UK equities. And that’s before any future reduction in dividend forecasts caused by the strength of Sterling. This asset class is worth another look.  [Read More... ]


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