The Beginning of The End is Sometimes a Fresh Start

On the other hand, bonds continued to sell off across the board.

During ECB’s October meeting, Chairwoman Lagarde announced that the Pandemic Emergency Purchase Program will end by March 2022. However, the ECB will continue to purchase assets within the general plan (APP), including maintaining accommodative measures, like Targeted Long-Term Refinancing Operations etc.

Today, the Fed meeting will be the main event, although the outcome is already known and well-priced into the markets by now. What’s more important than tapering details, will be the comments on inflation since that’s the major factor which could change the rate hike prospects. Indeed, the inflation rate is still at its highest levels in decades in most of the developed countries, with the largest contributor to that being energy prices. Also, demand remains strong and supply chain issues are not yet resolved.

In China, during the last month, a few property developers defaulted on their bonds, and regulators are now busy dealing with the contagion effects of Evergrande on the whole real estate sector. While they are trying to set up some metrics in order to limit the leverage of the companies in this industry, the other sectors recently impacted by harsh regulations, like the tech sector, are enjoying a little breath – after all the ups and downs, the Chinese tech sector ended the month flat.

October also marked the start of the earnings season for the third quarter. So far 82% of S&P 500 companies have reported better than expected EPS, which is above average. Tech companies however whose results usually exceed expectations and are above estimates, were split this time. Among the giant techs, only Microsoft surprised on the upside and replaced Apple as the world’s most valuable traded company. After a record quarter in all measures, Tesla joined the very select group of trillion market cap companies.

Finally, Facebook had a hard time last month: after a whistleblower testified to the Senate on the “toxic” effects deliberately spread by the company’s apps, the social media faced an outage that cut off all its apps for six hours. Then after, when the company reported its earnings, it missed estimates for the third quarter. By the end of the month, as if he wanted a fresh start after this unfortunate period, Zuckerberg revealed Facebook’s new brand name: Meta.

Finally, the month ended with meaningful events: the G20 in Rome, where an international tax agreement was signed. We also saw the opening of the COP26 in Glasgow, the two weeks’ climate change conference which should deal with the timeline of net zero carbon emissions.

With now half the world vaccinated against COVID-19 and kids soon to get vaccinated as well, the pandemic seems to be slowly coming under control and a kind of normalization is occurring. But this comes with some consequences such as constant high demand and not enough supply, caused by shortages in both goods and labor.

We don’t think this situation will improve in the near term and that’s why the first concern would be to stay protected against stagflation. For that matter, we stay overweight equity and on the fixed income side we stay focused on short duration high yield bonds which give a sufficient protection against inflation together with a limited correlation to rate increases.

As always, risk-management combined with rigorous sector and geographical diversification will remain key factors for investment performance.

You are more than welcome to contact us to discuss our investment views or financial markets generally.

Best regards,

Sweetwood Capital Investment Team

Not Only Leaves Are Falling

This time again, it didn’t bypass the rule and last month was indeed negative across the board for both equity and bond markets. Mostly impacted was the tech sector, because of higher treasury yields implying higher rates and thus weighing on growth companies’ future relative returns.

The other reasons for this pullback included the global resurgence of COVID-19, supply chain issues and concerns around the withdrawal of Central Banks’ support. On top of that, the US is in somewhat of a political crisis. After a shutdown had been avoided in extremis last week, the Congress has now two weeks to avoid what could be a first US default. In order to do so, the Republicans must agree to increase, or at least to suspend, the debt ceiling.

For now, they are playing with fire and unless they join the Democrats in voting to raise the debt level, the US could face a catastrophe and historic consequences, namely a US Treasuries’ default. Of course, a US default would have itself systemic consequences and the global impact on capital markets could possibly be much worse than any Pandemic or Subprime Crisis. However, to put things in perspective, this scenario has occurred before, in 2011 and in 2013, when Republicans tried to put pressure on the Obama administration.

Eventually it ended in the extension of the Treasury’s capacity. Finally, even without Republicans, Biden can invoke extraordinary measures to increase the debt limit. Therefore, even if it creates some turmoil in the near term, a US default is highly unlikely.

Central Banks’ meetings last month were pretty much in the same tone than before and with the same focus: the fast recovery allows to gradually tighten the policy and reduce the support; inflation now appears less temporary than expected and price pressures could probably continue into 2022. An interest rate hike is not imminent, and we wait for November’s meeting to have more details and timeline about the Fed’s tapering.

September was also the month of some international political changes. In Germany federal elections were held and for the first time in 16 years, Angela Merkel’s CDU party was defeated and lost its majority. Olaf Scholz of the center-left Social Democrat Party won the elections and talks are now being held to form a coalition either with the Free Democratic Party or with the Greens.

In Japan, elections also took place after Suga announced he was quitting his post of President of the LDP (Liberal Democratic Party), the majority party in the National Diet (the Japanese Parliament), and by doing so, automatically ended his term as Prime Minister after only one year.

Since then, the former Foreign Minister, Fumio Kishida, won the leadership race of the LDP and therefore became Japan’s new Prime Minister. Kishida is known to be market friendly, however he was left with quite a lot of economic issues to resolve and so some tough measures could be taken soon by the new administration.

As for China, if when the month started, some investors seemed to think that a certain balance was reached between political control and market efficiency, by the end of the month, the Evergrande huge debt crisis again overwhelmed the general sentiment. One of the most dominant Chinese companies in the most important sector (Real Estate accounts for 30% of Chinese GDP), gave us all a great example of how dangerous corporate debt could be for the entire economy when it is not limited.

And we can’t help thinking about how ironic this whole story is: after a full year of efforts of cracking down on tech companies and setting other harsh regulations to make profitable companies non-profit organizations, the biggest threat was in fact in the highly leveraged companies, one issue regulators didn’t take care of. The outcome of Evergrande’s crisis could be what will define what’s next for China.

From our side, as we continue to see record inflows to US equity ETFs, and while the current concerns over a potential US default seem to have little chance of materializing, we find that any pullback offers buying opportunities, whether it’s in strong companies moving down with the market or into bonds offering higher yields after the sell off. Also, if September unfolded by the book, then maybe we can follow the rule and expect a positive fourth quarter, as historically the last quarter is the best quarter of the year.

As always, risk-management combined with rigorous sector and geographical diversification will remain key factors for investment performance.

Sweetwood Capital provides asset management and investment advisory services to qualified high net-worth individuals. Our aim is to achieve consistent cash-flow generation for our clients through direct investments in transparent and liquid instruments. We offer a highly personalized service and construct investment portfolios that are calibrated to the risk vs. reward preferences of each client. Our clients do not take any counterparty risk through us as their assets are held in their own bank.

You are more than welcome to contact us to discuss our investment views or financial markets generally.

For a look at all of today’s economic events, check out our economic calendar.

Sweetwood Capital Monthly Market Insights

August was mostly positive for risky assets of the major developed economies with lower volatility in the background. On the other hand, safe assets such as investment grade bonds, were trading lower, with the benchmark 10-year Treasury yield starting the month below 1.20% and ending it above 1.30%.

Despite the fast spreading of the Delta variant and the vaccines’ declining efficiency against infection, global data continues to reflect optimism: consumption spending remains high, and we are witnessing a shift from goods to services lately. Two signals confirming that the recovery is on the right path. Also, since the Pfizer/BioNTech Covid-19 vaccine received FDA’s full approval, reopening is expected to accelerate further.

Two huge plans advanced in the US Congress during the summer: the infrastructure bill of $1 trillion, the largest federal investment into infrastructure projects ever made, and the reconciliation bill of $3.5 trillion, which is a social plan that Democrats will try to pass without Republicans’ support. This huge federal cash deployment will be highly supportive to sectors such as infrastructure, electric vehicles, cybersecurity and 5G.

Last week, the Jackson Hole Symposium, the annual Fed members summit in Wyoming, was held virtually, for the second consecutive year. This meeting focused on inflation and unemployment. After Chairman Jerome Powell stated that the economic recovery from the pandemic has exceeded expectations, he confirmed that the time has come to tighten the Fed’s purchase program. Therefore, tapering is now highly likely before the end of the year, while a rate hike is still not expected before 2023.

According to Powell’s statement, the supply chain disruptions (shortages and bottlenecks) alongside wage increases are still the main source of inflation. The spike in some prices is impacting only goods and services affected by the pandemic yet, and this trend tends to disappear with time (for example used cars prices). As for wages, the increase is welcome because it supports a rising standard of living, and it is still consistent with the long-term inflation target.

After the summer break, September will see the return of Central Banks’ meetings. From the Fed we expect more details regarding the upcoming tapering: when exactly, what, how much etc. Of course, a huge focus will be put on the August jobs report, that needs to confirm the “substantial progress” made in the labor market in July. September will also mark the end of the enhanced unemployment benefits from Covid-19, and so we may well have a wave of people returning to work in the US. The ECB’s meeting may be focused on inflation, since the last data released this week showed an unexpected 3% inflation rate in Eurozone, the highest level since 2011.

News from China was less dramatic this month, but the momentum has not yet returned to Chinese stocks. Some investors are starting to think that the new regulatory measures are now coming to an end, but the vast majority still await concrete positive moves in order to build back a bullish sentiment and bring capital back to the world’s second largest economy.

In terms of earnings, it was another strong quarter: 87% of S&P 500 companies reported positive surprises for EPS (earnings per share) and revenue. However, in terms of future guidance, it was split: about half the companies warned of slowing growth for the coming quarters but that’s to be expected after the boom experienced in some sectors during the pandemic.

While closing a seventh straight winning month, it’s hard to remain in the skeptical zone. Also, since the Fed remains very transparent and tapering has been highly predictable for quite some time now, we don’t expect any “tapering tantrum”, as we experienced in 2013. We continue to see stocks more appealing than bonds, and the fact that major financial institutions recently increased their target for US equity indexes comforts us in our overweighting choice.

As always, risk-management combined with rigorous sector and geographical diversification will remain key factors for investment performance.

You are more than welcome to contact us to discuss our investment views or financial markets generally.

For a look at all of today’s economic events, check out our economic calendar.

An Olympic But Not All Epic Month

On the fixed income side, investment grade bonds rose slightly with the 10-year treasury yield down 24 bps during the month, returning to February levels, at 1.16%. High yield bonds were trading slightly lower.

Rates and policies were left unchanged by both the European Central Bank (ECB) and the Fed, however while the tone remains dovish in the Eurozone, the Fed is already preparing the ground for a future tapering, indicating that it could start with lowering Mortgage-Backed Securities (MBS) purchases before Treasuries.

Another divergence between the Fed and the ECB is how they see Delta Variant impact. If the Fed doesn’t yet consider it as a potential game changer, ECB’s chairwoman Lagarde admitted it constitutes a growing source of uncertainty for the economic recovery.

Regarding inflation, divergence continues between the different Fed members, some of them see it stickier than Powell’s acolytes, who see its effects mainly coming from the reopening of the economy, and therefore transitory. The latest data showed indeed that a surge of 45% year-on-year in used cars prices drove the inflation rate up to 5.4%. However, even Jerome Powell has now admitted that the inflation rate was higher, and that inflation was lasting longer than originally anticipated.

Economic data is still mostly encouraging for the US as well as for the Eurozone. The latest numbers showed that the US economy grew by 6.5% during the second quarter (quarter-over-quarter) while the Eurozone’s GDP second quarter growth came in at 2%, after two quarters of contraction. Regarding the unemployment rate, while it disappointed in the US with a rate at of 5.9%, it was lower than expected in the Eurozone, but still close to 8%. This Friday, the July jobs report will be released in the US, an event highly watched by the Fed and that could be crucial for its future decisions.
After weeks of negotiations, the bipartisan infrastructure package of $1 trillion was drafted and amendments are now being voted for both the plan and its budget. This is a key legislation for Joe Biden’s agenda, and a huge process for the whole US for years to come, with major projects planned for roads, bridges, ports etc.

Once again last month, the bad news came from China as it continues to crack down on Chinese companies, not only from the tech sector but also from the education and healthcare industries. This new crackdown on the private tutoring sector is meant to reduce educational gap between poor and affluent families and lessen the disincentive for larger families, as private education is usually expensive and so it could discourage Chinese couples to have more than one child.

The issue is that becoming non-profit companies overnight makes their stocks practically worthless as well as causes huge job losses right across the industry. Therefore, since restrictions and regulations could possibly hit every sector now, from big companies to small ones, not only foreign investors prefer to stay away, but also Chinese business confidence took a hit, because these kinds of measures tend to discourage young entrepreneurs from building new businesses.

Alongside these moves, The Peoples Bank of China, (PBoC) decided to lower the Reserve Requirement Ratio by 0.5 % to 8.9%, meaning that banks would be able to hold less cash and therefore to grant more credit. Although the PBoC said it was “nothing special”, this cut is seen as an easing tool and is not usually used if growth is doing well. Investors will need concrete moves or announcements to build back a positive sentiment on China, and we assume the Chinese government is fully aware of it. Therefore, the ball is firmly in their court.

To a lesser extent, President Biden signed an executive order last month aiming to expand competition and fight monopolistic practices across all industries. According to him, too much power was given to some companies, and it has resulted in declining standard of living for Americans.

Finally, July marked the second quarter earnings season’ “kick off”. More than half of the S&P 500 companies have reported so far and once again a large majority released better than expected earnings and revenue. But the most interesting fact, is the phenomenal 85% growth in earnings for Q2, making it the highest year-over-year growth rate since 2009. From this level, even if earnings will continue to increase for the future quarters, it will surely be at a slower pace.

There is no fundamental reason to have a negative sentiment on the markets right now, but we stay aware that a slower growth is more than likely. However, with a 10-year real interest rate at historical low (negative 1.17%), equities are still the most appealing asset class, and we cannot afford being underinvested. Also, if inflation is going to pay for governments’ spending, as it seems to be the case for the time being, companies’ stocks will be the first to take advantage of it.

As always, risk-management combined with rigorous sector and geographical diversification will remain key factors for investment performance.

You are more than welcome to contact us to discuss our investment views or financial markets generally.

For a look at all of today’s economic events, check out our economic calendar.

From Inflation to Free Popcorn Bubble

Inflationary pressures remain the focus for now. According to Google, search interest for “inflation” is at an all-time high. It has also been largely discussed during the last companies’ earnings calls, especially the two main sources of inflation, that is the increase of supply costs (commodities, transportation, chip shortage, etc.); and the increase in wages, due principally to the difficulty of finding workers.

It seems that people currently receiving unemployment benefits till September are not in a rush to go back to work. As a result, in order to attract employees, many companies announced increases in salaries. With higher costs leading to increased prices, it does not look to us like inflation will be only transitory, as most of Fed and Treasury officials keep saying.

Note, that the only phenomenon that could be temporary is the comparative economic data which compares current economic performance to last year’s performance. This is at best quasi-irrelevant as last year’s numbers obviously reflect an economy that was then shut down.

While a rate hike is unlikely, the Fed could decide to reduce its bond purchases. Indeed, the release of the latest Fed meeting minutes gave some hints that such a move could possibly be announced during the next meetings – but more likely in July or September than in June. In Europe, the ECB made it clear that no tapering would happen before they see further evidence of a full economic recovery.

May was also marked by progress on the President’s massive infrastructure plan. Republicans made a $928 billion counteroffer to Biden’s $1.7 trillion original plan, proposing the use of existing funds for financing instead of a tax hike. A compromise must be negotiated and accepted by each side in order to pass the bill as soon as possible, as the Democrats wish to do.

On the ETFs side, ESG (Environmental, Social and Corporate Governance) ETFs, encountered more inflows than any other ETFs in Q1 and hit new records in terms of size. In addition, the new Ultra Short Bonds ETF of Vanguard, launched in April, has already raised $730 million, indicating that some cash is seeking to be invested on the sidelines for the time being.

Also interesting was the rebalancing of some of BlackRock’s ETFs. The giant asset manager decided to reduce the concentration and the volatility of its clean energy ETFs by adding a component of “energy transition” stocks, making the thematic ETFs a bit more mainstream. Moreover, it heavily rebalanced its USA Momentum Factor ETF, by switching most of the tech exposure with value stocks, especially Financials that now account for 1/3 of the ETF. An interesting new weighting, that although based on the past six months momentum, gives a clear indication of the outlook according to prominent actors.

Finally, May saw the fall of Bitcoin and the comeback of frenzied trading. After the cryptocurrency more than doubled in value in only a few months, one-third of its value was erased following Chinese regulators’ announcements and Musk’s tweets, both against the digital coin. Also, AMC Entertainment stock that was paired with GameStop during the Reddit saga in January made a comeback as traders’ favorite stock of the month: its shares were up more than 500% in one month only, based on nothing but meme-trendy-viral-trading.

The earnings season for the first quarter showed exceptional numbers and overall good guidance for the rest of the year. Since it is too early to price a rate hike, we continue to believe that, despite the current valuations, equity markets could be further supported. Having said that, everyone who follows the markets this year can feel the fragility and keep expecting the unexpected. In this context, we continue to reduce risk, to be prepared for an eventual sharp pullback.

As always, risk management combined with rigorous sector and geographical diversification will remain key factors for investment performance.

You are more than welcome to contact us to discuss our investment views or financial markets generally.

For a look at all of today’s economic events, check out our economic calendar.

Sell in May But Do Not Go Away…

During the different meetings last month, the various Central Banks, the Fed, Bank of Japan, People Bank of China, and the ECB left rates and policies unchanged as expected.

While the tone was quite optimistic on both sides of the Atlantic, Chairman Powell remained dovish and said the “time is not yet” to talk about tapering. Regarding inflation, Powell emphasized again that the Fed’s focus is on actual numbers and not on forecasts, and even if higher this year, the inflationary pressure should only be transitory.

However, last week Treasury Secretary Yellen shook the markets when she said that rising rates would be a necessary tool against an overheating economy. At the end of the day, the decision-maker regarding the rates is the Fed, but since Powell and Yellen are close, we may legitimately ask ourselves if they do not start questioning the inflation’s “temporary” nature.

During its meeting, the ECB said it would expect to lower bond purchases by the end of the year if vaccine rollout is improving and new variants do not represent a threat to the reopening.

In addition, the European Union plans to launch a Recovery Fund in June, under which it will issue a total of 800 billion EUR within five years, in order to support the post COVID economy.

The Central Banks in China, the US, and Europe are planning or checking a potential launch of a digital currency of their own – a move which may counter the original purpose of the cryptocurrency, a non-regulated coin.

Biden seems decided to finance his plans with tax hikes

In the US, President Biden seems decided to finance his plans with tax hikes: his $2.25 trillion infrastructure plan should be financed with an up to 28% corporate tax hike. He announced a $1.8 trillion children and families plan that should be financed with a tax increase as well. In addition, he proposed a capital gains tax hike from 20% to a 39.6% maximum rate for households making more than $1 million per year.

Of course, with a narrow majority in Congress, such increases will likely be compromised, but still, the tone is set, tax hikes will happen for corporates and for investors. An interesting and historical fact though: US markets tend to perform better in years of tax increases than during years of tax reduction. Food for thought…

On the vaccination side, Biden missed his target of 60% for the end of April. Nevertheless, even with 45% of Americans have received their first dose, restrictions are being eased all over the country. The new target is for 70% of Americans to get vaccinated by July 4th. In Europe, the vaccine rollout accelerated and as of today, 25% of Europeans have received their first jab. Israel is still a world leader with more than 62% of the population vaccinated.

April saw also the kickoff of the earnings season for Q1: so far 87% of the S&P 500 have reported, with 87% beating estimates. US major banks and giant techs reported extraordinarily strong numbers with good guidance, but little or no change was observed in their stock prices.

In the meantime, in China, regulators are focused on giant tech companies, and in this framework, Alibaba was fined $2.8 billion for breaking anti-monopoly laws, the largest amount ever imposed on a company. However, to put things in perspective, it represents only 2.5% of the forecasted revenue of the company for 2021 and the company accepted and complied with the charge without complaint. But for now, big Chinese stocks are under pressure mainly for that reason.

Virtual Climate Summit and the clean energy sector

Finally, a world leaders’ virtual summit on climate took place last month, organized by President Biden, hosting heads of states as well as philanthropists and activists on this matter. They all committed to efforts of lowering carbon emissions. This commitment has supported temporarily the clean energy sector. However, this sector is now suffering again, because of supply chain issues, despite actual good numbers.

Like automakers, renewable energy companies are being hit by the global chip shortage and by the cost of transport which has more than doubled this year. All that weighs particularly on solar energy companies that are in a period of development and investment.

From our side, as volatility and yields stabilize, and market movements on good news are contained, we tend to think that the recovery is now priced in and not much upside is left, at least in the short term. In this context, any bad news could have a strong and unexpected impact. However, for the midterm, two factors are incredibly supportive of the equity markets: first, the huge increase in dividend rates, even to above the pre-COVID levels, and secondly, the huge inflows into equity ETFs.

Indeed, inflows for the first quarter were the largest ever and more than three times the inflows during Q1 2020. If this trend continues, we could reach a total of $1 trillion cash brought to US equity ETFs by the end of the year, more than twice the actual record set in 2017. These facts tell us that there is plenty of money around and it mostly goes to one place, and one place only.

As always, risk management combined with rigorous sector and geographical diversification will remain key factors for investment performance.

You are more than welcome to contact us to discuss our investment views or financial markets generally.

For a look at all of today’s economic events, check out our economic calendar.

When the Black Swan Became White…

The rotation that had already started accelerated until the end of March: out of growth companies and into cyclicals. However, by the end of the month, investors’ appetite reverted into growth stocks and shares in the tech sector jumped again. This is the result of the recent optimism on the back of a quicker than expected economic recovery.

The fast reopening of the US economy is due to the vaccine rollout and the good news surrounding it. In addition to the available vaccines, Novavax vaccine may be approved next month by the FDA and Pfizer announced that tests showed its vaccine was safe for the 12-15 years old. President Biden’s target is now for 60% of Americans to be vaccinated by the end of the month and by that time all Americans should be eligible for vaccination. On the other side of the Atlantic, Europe is still struggling with more lockdowns and tighter restrictions, only 12-20% (depending on the country) having received the first dose.

Investors’ confidence, as well as the consumers’, was also boosted by the approval of the so expected $1.9 trillion stimulus in mid-March, and checks have already started to be received by eligible Americans.

Moreover, the last jobs report put numbers on this optimistic trend: jobs creation crushed analysts estimates, mainly coming from the leisure and hospitality sectors.

The VIX Index, which measures the market stress level, and which was itself volatile until recently, came back to pre-COVID levels, under 20, which represents a buying signal for traders.

Last month we also saw meetings of the ECB, the BoE, and the Federal Reserve who decided to leave rates unchanged and to maintain a dovish tone. The ECB and the Fed tried to reassure investors regarding inflation and rising yields. ECB chairwoman Lagarde said that the central bank will closely monitor the evolution of long-term yields, but she emphasized that it is not the ECB’s role to control the yield curve. However, after weekly bond purchases were relatively low during the first months of the year, the ECB has decided to increase them again.

On the currency side, while the yield differential is widening between the EUR and the USD, the USD strengthened last month and returned to November’s level which will help control inflation.

As for the markets movers of the first quarter, the best sector so far this year has been the Energy Sector, boosted by the performance of the oil price, +22% year-to-date. The price of oil should be sustained further, as during the last OPEC+ meeting, members agreed to maintain the same output for another month and starting from May, to gradually increase production.

On the other hand, the clean energy sector suffered outflows and a strong downside until Biden announced his $2.25 trillion infrastructure plan, in which clean energy is the epicenter. The sector rebounded by 8% on the news, and if signed this summer, this plan should be incredibly supportive to all the ESG linked investments. However, as the financing should come from a corporate tax hike to 28%, a Senate majority will be hard to obtain.

Among the most negative movers so far this year, Asian, US and European investment grade bonds have all sold off since the beginning of the year. Concerning Asian bonds, the strong sell off in both local and hard currency, was especially due to an improving economy in the US but also because of a stronger USD.

Chinese equities also had a negative first quarter but presented a buying opportunity to build a long-term position, on what is still the fastest growing major world economy. Concerning US-China relations, although two major officials from both sides met in Alaska during the last month to reopen talks, two recent events may have increased tensions again. First, Biden said he will not reduce the tariffs for now and secondly China has signed a 25-year agreement with Iran on economic activity and political affairs.

Finally, at the end of the month, a financial scandal shook markets and especially the banking sector: Archegos Capital was forced to unwind some $20 billion leveraged positions, causing a $4.7 billion hit for Credit Suisse. Following this episode, the Swiss bank announced a profit warning for Q1, and some senior managers even stepped down from their roles. Other banks involved with Archegos better managed the risk of margin calls and did not miss the occasion to congratulate their risk management.

The equity markets rebound is a feat when we consider that we just “celebrated” the anniversary of the pandemic’ first wave. This is not just euphoric: the last round of companies’ earnings showed growth. In addition, as the global economy reopens, data and forecasts will also improve. Therefore, we maintain our high convictions, and lately we took advantage of the weaknesses to increase some of our niche investments.

As always, risk management combined with rigorous sector and geographical diversification will remain key factors for investment performance.

Sweetwood Capital provides asset management and investment advisory services to qualified high net-worth individuals. Our aim is to achieve consistent cash-flow generation for our clients through direct investments in transparent and liquid instruments. We offer a highly personalized service and construct investment portfolios that are calibrated to the risk vs. reward preferences of each client. Our clients do not take any counterparty risk through us as their assets are held in their own bank.

You are more than welcome to contact us to discuss our investment views or financial markets generally.

For a look at all of today’s economic events, check out our economic calendar.