Blog

28th May 2017

Copia Monday Espresso

 

 

  • At the latest Federal Reserve rate-setting meeting, policy makers gave a clear signal that not only is it likely that short-term interest rates will be raised in June ’17, but also that they are now laying out plans to reduce their balance sheets, which have grown considerably with Quantitative Easing.
  • Donald Trump’s first budget came under fire after its release, as it will target $3.6tn of cuts to both the Health Care and Educational sectors, whilst promising massive tax cuts for both business and households.
  • With ever increasing pressure to cut costs, some of the largest ETF providers have floated an idea that will see them create their own market indices which will directly compete with those from MSCI, FTSE and S&P500.
  • The Office of National Statistics released its second reading of first-quarter GDP in the UK showing that the economy actually slowed more than originally expected, with an expansion of only 0.2%. The report cited net trade as being the largest drag in the UK economy during this period.

  • On Wednesday 31 May we will see the Bank of England release the UK Mortgage Approval numbers for the month of April, with expectations of 66,000 new approvals.
  • On Friday 2 of June we will see the release of the US Unemployment rate for the month of May, with market expectations at 4.4%, meaning no change.

A score of -1.0 indicates an extremely poor economic outlook, which is accompanied by a high probability of negative returns in risky asset classes like equities. The Risk Barometer tilts our portfolios away from equities during such periods.

A score of 0 indicates a neutral economic outlook with almost equal probability of positive and negative returns in risky asset classes like equities. The Risk Barometer maintains a balance between equities and other asset classes during such periods.

A score of +1.0 indicates an extremely positive economic outlook, which is accompanied by a high probability of positive returns in risky asset classes like equities. The Risk Barometer tilts our portfolios towards equities during such periods.

*as at latest realignment 22/05/17

Notice:

The performance of each asset class is represented by certain Exchange Traded Funds available to UK investors and expressed in GBP terms selected by Copia Capital Management to represent that asset class, as reported at previous Thursday 4:30pm UK close. Reference to a particular asset class does not represent a recommendation to seek exposure to that asset class. This information is included for comparison purposes for the period stated, but is not an indicator of potential maximum loss for other periods or in the future.

Risk Barometer

0

as at latest realignment

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    Copia Capital Management

    Fleet House, 8-12 New Bridge Street, EC4V 6AL

    Copia Capital Management is a trading name of Novia Financial Plc. Novia Financial Plc is a limited company registered in England & Wales. Register Number: 06467886. Registered office: Cambridge House, Henry St, Bath, Somerset BA1 1JS. Novia Financial Plc is authorised and regulated by the Financial Conduct Authority. Register Number: 481600.

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