Paul Severin am 21st January 2016 Ⓒ iStock.com
Interview with Peter Szopo, equity strategist Erste Asset Management (EAM) and Andreas Rieger, fund manager of ESPA STOCK GLOBAL
ESPA STOCK GLOBAL is an actively managed equity fund that invests in selected single stocks from around the world. In the last year the fund gained 14.31%, over the last five years the annualized performance was 10.45% p.a. *). For equity investors, the new year started very turbulent. I have asked Peter Szopo, our equity strategist and Andreas Rieger, fund manager of the ESPA STOCK GLOBAL about the latest developments (esp. China, interest rate cycle, valuation etc.) and how they navigate the global equity portfolio in this environment.
Gerhard Winzer am 12th January 2016 © Fotolia.de
The price declines on the equity markets at the beginning of the year suggest a decline in investor confidence. Is this justified? Please find a few hypotheses for 2016 in the following:
Gerhard Winzer am 11th January 2016 © iStock.com
We have experienced an increased degree of jitters on the financial markets at the beginning of the new year. The triggers of this situation are based in China. Chinese equities have incurred a slump, and the Chinese currency has depreciated relative to the US dollar. Given that at 17% the share of the Chinese economy of the global GDP on the basis of purchase power parities had already exceeded that of the USA (16%) these developments of course come with global effects.
Paul Severin am 04th January 2016 © Fotolia
Capital markets experienced significant price fluctuations in 2015. While euro government bonds recorded a relatively good performance contrary to expectations, riskier bond segments such as high-yield corporate bonds were disappointing. Regionally speaking, stock exchanges recorded a very mixed set of performances. Emerging markets such as China and Brazil ended up on the disappointing side, whereas the European equity markets posted significant gains. The important US equity market went sideways (in USD terms).
Investors with US-Dollar exposure benefited from the appreciation of the US-Dollar relative to the EUR. Commodity prices, above all oil, remained locked in their downward trend throughout the entire year. Emerging markets currencies also experienced falling exchange rates.