The Income Analysis Department 4 Banco has presented its Investment strategy for 2019, marked by "a slowdown in the global economic cycle, although maintaining reasonable levels of activity." On the positive side, still favorable financial conditions and, as the main drag on growth, "the high level of indebtedness at a global level", affirms the Director of Analysis, Natalia Aguirre.
The Renta 4 Banco team of analysts maintains a clear preference for equities over fixed income, in a context in which economic activity will continue to support the evolution of business results (growth close to double digits), while fixed income will stop counting with the explicit support of central banks.
Likewise, the equity valuations they are attractive in historical terms, with discounts of 20% and 30% vs. their 30-year median PER. "They are also so against European fixed income, where we expect a rise in IRRs, albeit limited," says the director. However, analysts warn: «the expected returns in equities will not be exempt from volatility, which could increase in the face of monetary normalization and the risks derived from growth (attention to trade negotiations between the US and China) or political (Italy , Brexit, European elections…) ». This increase in volatility will generate buying opportunities throughout the next year.
Investing in 2019: more flexibility
One of the common denominators of the investments developed in this exercise will be their high flexibility. That is, they can adapt to any scenario, even the most negative for financial markets. Both with regard to equities and fixed income and where alternative models are also included. In an investment strategy that is focused on the protection of invested capital. With a second tranche in the year that is presented as very complicated, as warned by many of the financial analysts most backed by the markets.
On the other hand, we cannot forget at this time that it is a pre-event scenario. rate hike in the euro zone. And this factor will ultimately determine the evolution of equity markets. Because if everything goes as expected by financial analysts, it will be predictably at the beginning of next year when there is a change in the monetary policy of the European community. With its corresponding impact on the equity markets, rather with a drop in the valuations of listed companies.
Seek profitability in emerging markets
There is no doubt that with a given situation of low volatility, the search for profitability clearly benefits emerging financial markets. But with a subsection that can be very important from this moment on and that is derived from the role that the technical indicators of each of these financial markets can play. Not surprisingly, the divergence between one or the other can be very relevant and this puts on the table that while the Indian stock market is very expensive at the moment, the opposite happens to the Chinese one that presents very competitive prices to take positions right now.
While on the other hand, it is also very relevant the fact that it is derived that the continued policy of monetary relaxation applied by the People's Bank of China It will help the economy of this country to rebound in a quarter or two. This is evidenced by the Nordea investment fund, which expects balance sheet problems to improve, as well as a slowdown in growth. It is an invitation to take positions in one of the most volatile equity markets in the world. Not surprisingly, it is very common that in a trading session its indices may rise by 3% or even more intensely and the next day the same percentage is left.
Uncertainty in the USA stock market
One of the markets that generate the most doubts among small and medium investors is precisely the United States. After having lived one of the most bullish periods of the last decades, with revaluations close to 90%. In other words, with impressive profits that have made many small and medium investors millionaires. Within this general context presented by the stock market on the other side of the Atlantic, Nordea Asset points out that the trend of US equities is positive. Although on the contrary, they do not rule out the possibility of a crash in carry trade operations.
Although one of the aspects that will determine its evolution in the coming days will depend on a specific event. It is none other than the derivative of the answer that in the end is taken from whether the labor market will overheat or not. Something that at the moment is not very clear on the part of the various agents of the financial markets. Well, it will be a fact that will lead the bags to take one or another path from now on. Not surprisingly, it will be a relevant source of reference to detect if we are facing a positive long-term trend in this very specific equity market. And that will undoubtedly influence the behavior of the other stock markets in the world, which includes the European and by extension the Spanish.
It is very common that in a trading session its indices may rise 3% or even more intensely and the next day the same percentage is left.
New guaranteed fund
Bankinter has launched the commercialization of a new investment fund: Bankinter IBEX Guaranteed Rents, FI, which completes the offer of investment products from its manager, Bankinter Gestión de Activos. This new fund guarantees, within a period of 6 years and 5 months, 100% of the initial capital -the value of the participation as of March 15, 2019-, plus six gross annual payments of 0,35% each on said initial investment or investment held (discounting voluntary repayments made by the participant). These payments will be made effective through mandatory refunds on August 4 of each year from 2020 to 2025.