Keeping a relatively neutral position with a view to increase risk early 2020.
Very strong asset class returns during 2019 leaves us cautiously positive towards end-year. Our Asset Allocation View has moved from a slight equity overweight to a neutral positioning during Q4 2019. Equities still seem to provide the best risk adjusted return expectations going forward. However, continued strong performance keeps us from going overweight at the moment. Tight credit spreads do not provide a lot of upside potential, whereas government bonds have some room to tighten further if recession probabilities should increase.
Certainly not Chairperson Powell’s “knockout, great, super strong employment report” but Still Enough for Fed to Taper. September job growth in the US was underwhelming vs. expectations but still a green light for a Fed taper announcement by year-end.
Going back more than 20 years, Kieger’s legacy has been built in healthcare and small companies. Over these decades we have developed our own “unique” asset allocation which has some outstanding and attractive portfolio characteristics, especially in recent turbulent times.