Should Investors Reposition Portfolios in Light of the UK Referendum to Leave the European Union?
No, assuming investors have heeded our advice to keep diversifying assets defensive.
No, assuming investors have heeded our advice to keep diversifying assets defensive.
Our biannual report summarizes asset allocation and total investment performance for 29 of Cambridge Associates’ UK foundation and endowment clients.
As the cacophony surrounding the 23 June “Brexit” referendum grows, just how much the United Kingdom stands to lose or gain from leaving remains unclear, and investors with substantial exposures to British assets would do well to pay attention to sentiment.
March’s publication summarizes three articles discussing the implications of the UK’s June 23 referendum vote on EU membership. The first argues that the UK economy stands to lose from an exit vote even under optimistic assumptions, the second highlights how the uncertainty connected to the vote is already taking a toll on the UK economy, and the third suggests investors should trim exposure to peripheral EU countries.
Yes, but the amount of outperformance could be limited, and growing macro-driven volatility will likely cap the absolute level of returns.
Our biannual report summarizes asset allocation and total investment performance for 31 of Cambridge Associates’ UK foundation and endowment clients.
UK large-cap stocks are undervalued, but lack a clear near-term catalyst to unlock this value; mid-cap valuations are moving higher, but so too are earnings.
The situations in China and Greece, not to mention Puerto Rico’s debt woes, serve as a poignant reminder not to be complacent. Investors should take care that portfolios are well constructed, diversified, and consistent with their ability to absorb downside risks while meeting long-term return objectives. With risks rising in some areas, and few bargains…
We continue to advise an overweight to Eurozone equities versus US equivalents given attractive relative valuations, greater potential for earnings growth, and tailwinds from the improving macro environment Eurozone equities have performed strongly year-to-date but may have more room to run given valuations and weaker medium-term performance. UK equities have similar valuations but are less…
Many factors contributed to the global financial crisis, but an excessively high level of indebtedness built up over many years was a crucial one. Although the crisis first blew up in the US housing and mortgage markets, the receding tide of liquidity revealed many other exposed debtors, especially within the Eurozone. In the aftermath of…