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Need for patience

Dear reader
The renewed escalation of the trade war between the USA and China has caught investors off guard and triggered a sharp setback in financial markets in May. The expected economic recovery could be delayed given the heightened levels of uncertainty, and investors will need a great deal of patience to wait until the news flow improves. We do not think the US Federal Reserve (Fed) will be quick to provide support, which could lead to further disappointments. Hence, we are sticking to our underweight allocation to equities and remain cautiously positioned in our balanced portfolios. The total return generated in our portfolios since the start of the year is very satisfactory, and we expect the investment environment to improve again in the second half of the year.
Yours faithfully
Philipp E. Bärtschi, CFA
Chief Investment Officer

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