While financial markets have seen massive gains from the darkest days of 2008’s financial crisis, the global economy has yet to fully recover to robust growth levels, and expectations for future market returns are far more modest. In this video, Robert McConnaughey, Global Director of Research at Columbia Management, explains his top investment strategies for 2015, given this conservative outlook for overall market tailwinds.
Global Director of Research Robert McConnaughey considers the global economy in light of the successful policies of former Singapore Prime Minister Lee Kuan Yew. McConnaughey summarizes current obstacles and highlights paths to economic improvement.
Key investment professionals review the first half of 2014 and share their insights into what may be ahead for the second half of the year. Interest rates
Zach Pandl, Portfolio manager and strategist
Government bond yields declined in early 2014, both in the U.S. and in other developed market economies.
“Given the scarcity of growth out there, I find it incredible that companies with little to no debt and very robust top and bottom lines are trading almost in synch with their underlying growth rate. Nobody is chasing these stocks to any great degree, and I find it to be a huge opportunity. —Thomas Galvin, CFA, Senior Portfolio Manager
We believe that finding growth opportunities when growth is scarce takes proprietary bottom-up research, alpha-generating investment ideas and a disciplined security selection process.
Under Lee Kuan Yew’s leadership, Singapore rose from a sleepy British colonial trading post to become one of the wealthiest per capita nations in the world. The two key pillars of Singapore’s historical ascent were a continuing focus on disciplined governance reforms and improvement, and a relentless drive to climb the value chain in production.
Until recently, ethical investing has focused on avoiding exposure to perceived negative activities. Municipal bonds can offer a cost-effective way to fund programs and infrastructure to serve the public good.
Recent oil and commodity price declines have raised concerns about global deflation and price stability. Areas with pricing power deserve a premium, and as with any merchandise, when it is increasingly scarce, that premium can become substantial.
Recent selloff has tested stance that investors would benefit from seeking scarce growth, so long as that growth did not become wildly overvalued. We appear to be moving into a “sorting out” stage where investors begin to more granularly assess both the fundamentals and the incremental opportunities.
In Japan, there is general optimism for a steady economic recovery, with a prevailing sense of confidence in reasonable valuations and a low bar for incremental improvement. Companies that can take advantage of global business opportunities look far more attractive than those simply waiting for a rising national tide to lift their boats.
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