In America, tumultuous times; in Europe, political volcanoes threatening to erupt; here at home investors battle with the imponderables of Brexit, rising inflation and the prospect of a consumer spending slowdown.
And all this with equity markets looking decidedly toppy and vulnerable to correction. So what next for markets? And what should investors now do?
There is a sense that we are moving to a critical inflection point for markets
Help is at hand. On 28 March, The Scotsman is holding a major public conference on the savings and investment outlook. It brings four leading financial experts to Edinburgh to offer their compelling perspectives on the outlook for markets and how investors can best position themselves for the uncertainties ahead. It’s an opportunity to reflect and reappraise our approach to saving – whether for short-term goals or long-term retirement planning.
And it could hardly be better timed. There is a sense that we are moving to a critical inflection point for markets: a convergence of major events, the possibility of correction after a surge that has swept markets here and in America to all-time highs; and an intensifying search to find the next decisive growth points for business and investment.
On the top table will be Tom Walker, manager of the Martin Currie Global Portfolio Trust. This £230 million investment trust has put in an outstanding performance over the past five years with its shares doubling in value, handsomely outpacing the average achieved by similar trusts in the global trust sector.
He will be followed by the outstanding investment analyst Russell Napier, co-founder at ERIC Electronic Research and Against The Head Ltd. Often described as the stock market’s most cheerful pessimist, Russell is best known in Edinburgh as the founder of the Library of Mistakes, an invaluable reference point for the study of market cycles and crashes. If there is a “Black Swan” looming ahead, Russell will be among the first to warn us. He will speak on market valuation, historical perspectives and the risk of a correction becoming a rout.
He will be followed by one of Britain’s most widely quoted advisers on financial affairs: Merryn Somerset Webb, editor-in-chief of Money Week – a brilliant, polemical columnist in the Financial Times and a regular guest on radio and TV. Merryn will giving the conference some practical advice for retail investors in 2017.
And addressing arguably the most pressing concern of the moment will be Bob Hair, wealth planning director and head of the Edinburgh office of Cazenove Capital Management. What does Brexit mean for our financial planning – “Dystopian Future or Brave New World”?
There will be an opportunity for the audience to put questions to the panellists or invite them to flesh out particular points and issues raised in their presentations. There could hardly be a broader bandwidth of expertise and perspectives to help investors in their financial planning. And it should be a particularly helpful conference for independent financial advisers to bring themselves up to speed with current thinking on the outlook.
Brexit, of course, has been a dominant concern – across politics, business and finance – in recent months. But it is important for investors to retain a global perspective. Here it is particularly apposite to have Tom Walker’s take as manager of one of the UK’s most successful global investment trusts.
Sterling, of course, saw an immediate fall and is now down some 16 per cent since 23 June – and down 10 per dent against the euro – though with the UK’s ballooning trade deficit a fall had been long overdue.
Walker’s take is that this is not all bad news. As global equity investors based in the UK, we have enjoyed a good uplift in our overseas investments – many of which are of course UK quoted companies. The FTSE World index since 23 June, 2016 has returned about 14 per cent in local currency terms – but 32 per cent in sterling terms – an impressive return for investors.
However, the full effect of weaker sterling is yet to be felt, as costs begin to rise through the supply chain and suppliers seek to protect their margins and share the pain with consumers.
• The Scotsman Conference: Investment in a post-Brexit world will be held at the Hilton Grosvenor Hotel, on Grosvenor Street, Edinburgh, between 8am and 10:30am. Fee of £20 plus VAT includes tea, coffee and canapes. For booking and further details go to www.scotsmanconferences.com, or email firstname.lastname@example.org