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Autumn Outlook: Key takeaways from our panel

1 December 2017OutlookHighlightsEconomics

Autumn Outlook: Key takeaways from our panel

  • Emerging markets flagged as a significant opportunity
  • Corporate earnings a key indicator for the next 12 months
  • A diversified portfolio helps manage risk in times of political volatility

Some of the best minds in finance formed the panel for our Autumn Outlook event at The Savoy hotel in London on 18 October 2017. The debate was led by Vidur Varma, Citi's Products and Advisory Director, and covered everything from Emerging Markets to President Trump's policies and how to take advantage of political volatility. Of the topics discussed on the evening, each of our speakers outlined the key takeaways investors should think about going into the next 12 months.

Emerging Markets a key opportunity

Jeffery Sacks, Director Investment Strategist for Citi EMEA, said that those looking for a single indicator for the next 12 months should watch corporate earnings closely. "The chairman's statements are going to be telling us whether they can look ahead," he said. "And if there's good confidence they will tell us how long the cycle has got ahead of it."

Sacks also tipped the audience on his favourite investment area for the next 12 months. "A key opportunity is emerging markets," he stated. "Take a long term view and use the volatility to time your entry points."

Go long term with cyclical stocks

The value of cyclical stocks was a key point made by Luca Paolini, Chief Strategist at Pictet. In the light of a possible US recession and other global volatility, he agreed with Sacks that emerging market stocks could be a good opportunity for investors.

"But they have to be cyclical," he noted. "You have to buy what is cheap. And don't sell too early because normally the end part of this cycle is one of the most attractive for investors."

Turn volatility into opportunity

BlackRock Director and Product Strategist Matt Williams championed the opportunity for investment in European markets in the light of political uncertainty due to the likes of the upcoming Italian elections and the Brexit effect. He advised attendees to watch the earnings growth and ensure that it was being maintained – as this was a positive indicator for European equities.

"At the moment we have a world where the European political risk has dissipated quite nicely," Williams said. "Prepare for unpredictable periods of volatility – at those moments be opportunistic and use them to access the best entry point. Because the EU markets are pretty high quality, and you just want that dislocated market to get you an extra 5-10% off your entry price."

Combatting volatility with a diverse portfolio

Varma ended the debate by pointing out that the best way to protect your investments in unpredictable times is by maintaining a varied portfolio. "The message from us at Citi is about diversification," he said. "In times of market volatility, having a diversified portfolio is the best way that you can manage that volatility and align it with what works for you."

You can find out more information on preparing your portfolio for 2018, including use of the new MF Wrap product, by speaking to your Relationship Manager. And they'll of course be happy to answer any questions you have on any of the topics covered by our panel too.

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