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Multi-Asset Blog - The next Master of the Universe

17 October 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
Who will be the next Governor of the Federal Reserve?

One of the most influential leaders in the world will be appointed soon. You won’t have been able to vote for the candidates, nor will any of your neighbours. But don’t worry, the appointment will be decided by a wise leader, the 45th President of the United States, Donald Trump. Yes soon, we will know who will be the next Governor of the Federal Reserve.  

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Multi-Asset Blog - Contrarian investing in Eastern Europe

29 September 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
Opportunities in Eastern Europe

Contrarian investing is often thought of as being like catching a falling knife: looking for assets that are tumbling and heroically buying into them at the bottom. Like all dangerous games, you can sometimes play and look like a hero, but more often than not you come off worse for wear. Our approach to contrarian investing is not to fight the herd, but rather to look elsewhere for great opportunities that are just off most investors’ radar screens.

One equity market that meets this approach is Eastern Europe, comprising of Poland, Hungary and Czech Republic. Not part of Europe, so ignored by European investors, but not big enough to grab the full attention of many emerging market investors. 

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Multi-Asset Blog - UK Paycuts

18 August 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
UK Paycuts – Thanks for your hard work, here's a pay cut

Imagine walking into your manager’s office at the end of a good year and your boss smiles and awards you a pay cut. This is exactly what has happened to workers in the UK this year. Whilst wages have risen 2.1%, inflation is running at 3.6% so in real terms, the average worker is 1.5% poorer than they were last year. Prior to 2008, workers’ pay exceeded inflation by 2.5%, so every year people ended the year better off than they started it. Since then real wage growth has been negative, so on average, after inflation, UK workers are earning less than they were nearly 10 years ago. 
 

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Multi-Asset Blog - The 3-6-3 Rule

11 July 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
The 3-6-3 Rule

Bank managers used to operate on the 3-6-3 rule: borrow at 3%, lend at 6% and be on the golf course by 3pm. Ultra-low interest rates and QE has pushed down the spread between the cost of borrowing and lending which has had a detrimental effect on their net interest margins. Rising bond yields relieve this pressure, and this combined with far fewer fines, an easing of the regulatory environment and cost cutting means that earnings are growing again. 

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Multi-Asset Blog - Mayday UK Election

09 July 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
Mayday

Politics has not lost its power to bamboozle pollsters and surprise markets. What was meant to be an opportunity to secure a strong conservative majority, now looks like a seriously rash move. Theresa May’s conservative government has been forced to attempt to form a coalition with the Democratic Unionist Party to secure a parliamentary majority. If they fail to reach an agreement, there is every possibility that the UK voters will be back at the polling stations later in the summer. 

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Multi-Asset Blog - America Last?

11 May 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
America Last?

US investors could be forgiven for putting America first in their asset allocation over the last seven years. US stocks gained over 130% from the end of 2009 to the end of 2016, whilst the rest of the developed world rose less than 30% and emerging markets only managed to return 6% in dollar terms.

American equities have had a lot going for them: a hugely supportive central bank, the strongest recovery of the large developed economies, high and growing margins and a vast buyer of equities – the companies themselves - issuing debt to buy back shares. These elements have all contributed to stronger earnings growth than was available elsewhere. In addition, global investors have been willing to attribute higher valuations to capture these earnings, further boosting share prices. 

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Multi-Asset Blog - Choppy markets after flat calm

21 April 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
Choppy markets after flat calm

After months of plain sailing in markets, a squall has buffeted markets over the last month. Global equities when measured in Sterling have fallen 4.5% from peak to trough. In the US, equity markets had gone 110 days without falling 1%; they typically fall that much every 11 days. That run inevitably came to an end in March. 

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Multi-Asset Blog - The Fed raises rates

16 March 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
Surprise! The Fed raises rates expected

Just three years ago, the Federal Reserve predicted that by March 2017, interest rates in the United State would have been hiked 11 times and stand at 3%. The reality has been just 3 rate rises to 1%. Disappointing growth and subdued inflation has dissuaded the committee from increasing rates at a faster pace.  

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Multi-Asset Blog - Buffett’s bet on fees

28 February 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset
Buffett’s bet on fees

I spent Sunday morning reading Berkshire Hathaway’s shareholder letter. Berkshire is no ordinary company, and its letter written by CEO Warren Buffett is no ordinary annual report. Its packed with wit and wisdom, covering a wide range of subjects from share buybacks to accounting standards. Remarkably he makes these subjects entertaining, which goes some way to explain why I’ve been reading his annual letters for almost 20 years. 

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Multi-Asset Blog - New investment - British Empire

15 February 2017

Will Bartleet, CIO and Portfolio Manager of Pacific Multi-Asset.
British Empire: an undervalued asset

Sometimes investing is simple. Everyone understands that if you can buy something for less than it’s worth you should do well. British Empire adopt this approach in less well researched parts of the market, looking for both undervalued assets, and importantly, underlying assets that will appreciate over time. Their hunting ground is in investment trusts, family controlled holding companies and property companies listed around the world. These give them exposure to a hugely diverse range of investments, including ecommerce businesses, New York real estate, Swedish industrials and German residential property. 

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