Asset consultants have recently started offering medium-term asset allocation advice, often as a separately priced service.
Watson Wyatt Worldwide calls it “dynamic strategic asset allocation”. Russell Investments calls it “enhanced asset allocation”. Whatever the term, the advice sits between tactical asset allocation at the short end and strategic asset allocation at the long.
Not withstanding the effect, for investors, of globalisation, country and sector bets still drive the performance of global equity portfolios. And research shows that whole countries tend to stray from fair value for a lot longer than individual stocks do. Deutsche Asset Management has produced a paper on ‘Diversification-Based Investing’, which leads one to think about building a core balanced portfolio of country and sector index funds.
A food company owned by the $65 billion Qatar Investment Authority (QIA) has launched a joint venture in Sudan as part of its strategy to generate profit and secure food supply by investing in overseas agricultural businesses.
The world needs to move back to a rules-based system of oversight over currencies and enhanced global surveillance of national macroeconomic policies, according to a leading Professor of Economics at the University of Oxford, UK.
Another big bank is set to hive off its funds management business to shore up its balance sheet, with this week’s announcement of the proposed divestments by ING Group.
China Investment Corporation has for the first time revealed its investment strategy. SONIA HAN reports that the Chinese sovereign wealth fund has accelerated its investment program in open-market products and industries such as mining, energy and real estate. The CIC is seeing value after the crisis but is also looking to limit portfolio risk.