The sustainable investor for a changing world


Asset allocation video – Taking risk off the table

Daniel Morris
17/06/2022 · 2 Min

Higher yields, worries about rising inflation and slowing growth, and the prospect of more – and larger – US rate rises have left financial markets reeling, resulting in returns that have rarely looked weaker and leaving 60/40 portfolios nursing double-digit losses reminiscent of the global financial crisis of 2008. What of asset class positioning in this scenario?

Maya Bhandari, head of multi-asset, and chief market strategist Daniel Morris discuss the reasons for a short position in core duration assets in the US, Europe and Japan and being long commodities.

Amid mixed, if not over-optimistic, earnings forecasts, equity valuations may have improved, particularly for growth stocks in the US. However, European equities notably face downside risk to their cash flows. Chinese equities now look relatively cheap, particularly in the technology sector. Watch our monthly video with Maya and Daniel for details.


Please note that articles may contain technical language. For this reason, they may not be suitable for readers without professional investment experience. Any views expressed here are those of the author as of the date of publication, are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may take different investment decisions for different clients. This document does not constitute investment advice. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. Past performance is no guarantee for future returns. Investing in emerging markets, or specialised or restricted sectors is likely to be subject to a higher-than-average volatility due to a high degree of concentration, greater uncertainty because less information is available, there is less liquidity or due to greater sensitivity to changes in market conditions (social, political and economic conditions). Some emerging markets offer less security than the majority of international developed markets. For this reason, services for portfolio transactions, liquidation and conservation on behalf of funds invested in emerging markets may carry greater risk.

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