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Stranger from another planet

Date: 19/11/2018
Category:

On the whole, equity markets had a positive week with the UK, once again, being one of the major exceptions.  You’d need to be a stranger from another planet to have missed the reasons why the UK is struggling.  All we will say is that, despite the rhetoric, nothing has actually changed yet and the outcome of the Brexit negotiations remains impossible to predict.  As a result, despite the temptation to top up our UK equity positions, this remains a ‘bet’.  Gambling is not our job so we prefer to wait.  If we miss a bounce on the back of a deal then so be it.

Elsewhere, it has been good to see some strength returning to the emerging markets.  A long term theme for us, we have had to ride through some tough times.  We put these positions in place in the knowledge that we would face exactly these challenges and remain of the long term view that these markets present a very attractive opportunity set.  That there will be further tough times is, for us, no reason to eschew these investments.

Amid all of the political headlines, the oil price seems to have slipped under the radar.  The expectation of over USD100 per barrel now looks like a pipe dream.  Russia, the US and Saudi now dominate global production.  President Trump’s tough talk on Iran neglects to highlight that a number of waivers have been granted to allow the purchase of Iranian crude.  All in all its good news for net importers.

We sign off with a now all too familiar refrain.  We believe we are nearer the end of the cycle than the beginning.  There has been a lot of talk about things being different because the cycle has been longer and weaker.  We think that the risk of a serious pull back in equity markets is higher than many think and that’s why we have been de-risking over the last 18 months.  Well, as we have said before, it’s a journey ands we will be de-risking further in due course.

Regulatory notice

This message may contain information that is confidential or privileged. If you are not the intended recipient, please advise the sender immediately and delete this message. KW, KW Wealth, KW Protect, KW Wellbeing, KW Institutional, KW Partner and KW Private Office are trading names of KW Wealth Planning Limited (registered number 01265376), KW Investment Management Limited (registered number 06931664 ) and KW Trading Services Limited (registered number 03109469) which is a member of the London Stock Exchange.  Each of these companies is authorised and regulated by the Financial Conduct Authority and has its registered office at 13 Austin Friars London EC2N 2HE. KW investment Management Limited is also regulated in South Africa by Financial Sector Conduct Authority.  All these companies are wholly owned subsidiaries of Kingswood Holdings Limited (registered number 42316) which is incorporated in Guernsey with registered office at Regency Court, Glategny Esplanade, St Peter Port, Guernsey, GY1 1WW.

Risk warnings

This message is not to be construed as a solicitation or offer to buy or sell securities and does not in any way constitute investment advice, nor should it be used as the basis for any investment decision. The information contained in this message has been prepared using all reasonable care. However, it is not guaranteed as to its accuracy, and it is published solely for information purposes. Our opinions are subject to change without notice and we are not under any obligation to update or keep this information current. The investments discussed in this message may not be suitable for all investors. KW Wealth does not guarantee the performance of any investments.  Past performance is not necessarily a guide to future performance. The value of investments may go up or down and you may not get back the amount you have invested. The income from an investment is not fixed and may fluctuate. The value of an investment involving exposure to foreign currencies can be affected by exchange rate movements which may cause the value of the investment to go up or down. KW Wealth and/or its affiliated companies and/or their employees may, from time to time, hold shares or holdings in the securities discussed in this message and may as agent buy or sell those securities.

Restricted investors

This document is not, and under no circumstances is to be construed as, an advertisement, or any other step in furtherance of a public offering of shares in the United States or Canada.  This document is not aimed at persons who are resident in the United States, Canada or any province or territory thereof, nor any other jurisdiction where such distribution would be contrary to applicable law or regulation.

The value of investments and any income from them can fall and you may get back less than you invested. KW, KW Wealth, KW Protect, KW Wellbeing, KW Institutional, KW Partner and KW Private Office are trading names of KW Wealth Planning Limited (registered number 01265376), KW Investment Management Limited (registered number 06931664 ) and KW Trading Services Limited (registered number 03109469) which is a member of the London Stock Exchange. Each of these companies is authorised and regulated by the Financial Conduct Authority and has its registered office at 13 Austin Friars London EC2N 2HE. KW investment Management Limited is also regulated in South Africa by Financial Sector Conduct Authority. All these companies are wholly owned subsidiaries of Kingswood Holdings Limited (registered number 42316) which is incorporated in Guernsey with registered office at Regency Court, Glategny Esplanade, St Peter Port, Guernsey, GY1 1WW.