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Resilient financial markets

Dear reader
Financial markets have been subjected to two endurance tests so far this year. After the markets quickly absorbed the shock from the escalation of tensions between the USA and Iran at the beginning of January, it also appears that the fast-spreading coronavirus has not become a stumbling block. The generous and steady provision of liquidity by central banks has helped to greatly strengthen the resilience of financial markets. Investors have continued their search for yield and are using every minor setback to build up new risk positions. Provided the economic recovery remains intact, demand for equities, in particular, should continue to pick up. We have therefore used the current phase of uncertainty to gradually increase our equity allocation to a neutral level.
Yours faithfully
Philipp E. Bärtschi, CFA
Chief Investment Officer

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