Global Head, Citi Private Bank
June 4, 2020Posted InInvestment Strategy
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Our semiannual publication setting out our key expectations for the economy and markets is now available.
I am very pleased to share with you our Mid-Year Outlook 2020, which sets out our expectations for the global economy and markets for the rest of 2020 and beyond.
View the full report, videos, and other materials.
This is a rare and remarkable time. The worst pandemic in more than a century led to an engineered collapse of the record-long economic expansion since 2009. Now, though, brand new economic and market cycles are getting underway. We expect a more rapid rebound than many others do. But just as the COVID collapse is no ordinary recession, we stress that this will be no ordinary recovery.
While beaten-down bargains are less widespread than in previous new cycles, we identify many markets with greater rebound potential. Among the various opportunities we highlight are emerging markets, small- and mid-cap equities globally, and certain sectors that were hit much harder by the pandemic-driven shutdown. History also suggests that private equity, real estate, and hedge fund managers could see many more opportunities over the next year or so.
As the world begins the transition from fear to prosperity, we believe that a new approach to investing is required. The impact of unprecedented stimulus measures upon valuations has also prompted us to revise our long-term asset class return estimates. In particular, very low rates mean that many bonds will no longer help diversify portfolios as they traditionally have. We therefore suggest long-term diversification changes to most asset allocations. With many clients holding far too much cash, we reiterate the folly of market timing and the importance of getting fully invested and staying that way.
We very much hope that you will be able to join us at our forthcoming series of Mid-Year Outlook 2020 livestream events, and put your questions directly to us.
Today’s new cycle is a time to prepare yourself, your family, and your wealth for the opportunities and risks that lie ahead.
Your relationship team stands ready to work with you to customize our ideas for your portfolio.
Thank you for the trust and confidence you place in the Private Bank.