The first quarter of 2015 is well under way and what an exciting start to the year it has been. The Swiss National Bank decided to unpeg the Swiss Franc from the Euro, causing a 20% move in the currency cross and unprecedented volatility. Syriza, an extreme left – anti-austerity political party, had a landslide victory in Greek elections, with some interesting negotiations with the EU to come over the next few weeks. Also, Mario Droghi (the Governor of the European Central Bank) released unprecedented Quantitative Easing (“QE”) as deflation risks rise in parts of Europe. All these events have one thing in common, Europe!
In this issue, we look at the Retail Distribution Review that is presently taking place in South Africa, changing the way their finance industry looks at discretionary investment management and investment consulting for private retail clients. Whilst Rob Macdonald’s article focuses on South Africa, he draws on an awareness of the benefits/impact this same process has had in other territories, both positive and negative.
Shaun McDade takes us on a virtual tour of the globe as he reviews the international asset allocation situation over the last 3-4 months, looking at the impact of a number of major events and changes in the markets during that period.
Andy Pfaff, our in-house commodities expert, looks at the oil price collapse and its implications for the future, should the world be rejoicing or worried? Liontrust’s London based global bond manager, Mike Mabbutt, shares his views on volatility in the bond and currency markets during the latter part of 2014.
For our South African market investors, Roeloff Horne writes his regular article on the asset allocation front in South Africa and MitonOptimal’s views looking forward. Also, from our Cape Town office, Simon Morrison CFA (Head of Quantitative Research) considers the potential benefits of including offshore fund exposure within South African client portfolios, based on the present market position. I also want to take this opportunity to publicly congratulate Simon on the birth of his second child.
The important take-away point is that volatility is rising across global markets and our portfolios are positioned to benefit from this, where possible, as well offering a degree of protection against that volatility.
Finally, on a more relaxed note, ‘Meet the Team’ introduces Simon Sharrott ACSI, a senior member of our international investment team, based in our Guernsey office. Simon joined the finance industry a few years ago, after a spell of playing professional rugby in the UK, and brings the same rugged determination to his role as an Investment Officer. I have to begrudgingly admit that he is a better front row forward than I ever was, but the fact that he enjoys an occasional single malt and can’t beat me at golf makes him an invaluable member of the MitonOptimal family.2014 Q4 MitonOptimal Newsletter_web.pdf