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A difficult period for the performance of some thematic funds has given fuel to the naysayers’ arguments. But we believe thematic investing with an active approach is a powerful tool for investors now and in the years to come. Thematic investing has taken off in recent years. Global thematic assets under management stood at $400 billion as of 1 July 2023, up 11% from the end of last year (according to data from Goldman Sachs).
This weekend sees the culmination of nearly two months of fierce competition between the world’s biggest rugby nations as New Zealand and South Africa battle it out in Paris in the final of the Rugby World Cup. It goes without saying that the best teams have made it this far. Both have navigated a multitude of obstacles through a display of skill, power, and endurance.
Let's have a look at the impact of "deglobalisation" on some of our favoured themes: smart manufacturing, energy transition and climate change, and the circular economy.
Central banks around the world are hiking interest rates to battle rising inflation. Recessions are now expected in the US, UK and Europe in the next year. Interest rates around the world are rising at an alarming pace, as central banks admit that inflation is becoming more ingrained, rather than just a series of transient shocks.
Regulatory pressures have dominated the headlines for Chinese e-commerce in the past 12 months. We think the focus is now shifting. Nothing showcases China’s love of e-commerce better than Singles’ Day, or 11.11. This unofficial holiday, initially founded as an anti-Valentine’s Day for singletons, is held annually on the 11 November.
Russia’s invasion of Ukraine has opened fault lines between nations which will affect trade relations and investment for years to come. The war in Ukraine is already having a significant effect on inflation and activity in the world economy as commodity prices have soared and supply chains have been disrupted.
A record sell-off coupled with a shifting economic backdrop mean opportunities in global fixed income markets have appeared. It has been an extraordinary time for bond markets. As an asset class, fixed income is often seen as equities’ boring cousin, particularly over the past decade of low yields. Recent months, however, have been anything but boring, albeit for the wrong reasons.
People are worrying about a global recession and with good reason. But what if the factors driving rising prices are beyond the limits of policymakers’ control? I discuss what central bankers’ next move might be, what markets are pricing in and what the probability of a recession is.