Each month in PWM, nine top European asset allocators reveal how they would spend €100,000 in a fund supermarket for a fairly conservative client with a balanced strategy.
Benjamin Hamidi
Senior portfolio manager, ABN AMRO Investment Solutions.
Based in: Paris, France
“Global growth still seems to be resilient, despite uncertainties and the potentially stagflationary impact of tariff risks. At the same time, the eurozone economy appears to be showing the first signs of a recovery, as evidenced by the positive momentum of economic surprises, improving sentiment thanks to decent earnings, the ECB’s forthcoming rate cuts, the massive European defence plan and the German infrastructure project. We remain vigilant about activity, political risk and trade war evolutions. Against this backdrop, our global exposure to equities remains unchanged, but we slightly increase the weight of European strategies and maintaining a moderate duration.”
Luca Dal Mas
Senior fund analyst, Aviva Investors.
Based in: London, UK
“Recent data in the US has been softer than expected, while core inflation data met expectations, helping pushing yields lower. On the industrial side, preliminary survey data indicate a tentative bottoming out in the manufacturing cycle, with Germany and the UK lagging, while Chinese data were slightly higher than expected. In February, the US announced a series of new tariffs targeting various countries, including a 10 per cent tariff on Chinese imports and a 25 per cent tariff on all steel and aluminium imports from a series of countries. Financial markets were influenced by this combination of tariff announcements, economic data, and central bank policies, with US indices closing the period down, while European markets fared marginally better. In portfolios, we have taken partial profit in gold and reduced US equities exposure on a risk management basis. In fixed income we have reduced our sensitivity to US Treasuries in favour of other markets.”
Jorge Velasco
Director of Investment Strategy, CaixaBank Private Banking.
Based in: Madrid, Spain
“In asset allocation, the overall outlook is attractive, but politics introduces new risks, resulting in a need to be more tactical. Nominal growth supports profit growth, central bank rhetoric and falling oil prices will limit damage, while broadening growth favours credit and peripheral spreads, even if they are somewhat tight. Politics opens several “heads or tails” scenarios without being able to anticipate the outcome. The conclusion is that the risk position should be more tactical and somewhat more cautious than in recent quarters. In terms of changes, this month we are looking to reduce the concentration of the portfolio to a smaller number of companies. We will replace the Vanguard S&P 500 line with a US equity fund with a value bias. We are adjusting the weights of global equity and US equity to balance geographic allocations and refine the changes.”
Adam Norris
Portfolio Manager, Colombia Threadneedle Investments.
Based in: London, UK
“Last year’s winner became this month’s loser as the equity market rotated between both style and geography in February. European equities were the best performer as European governments united on foreign policy and, crucially, a relaxation of budget restrictions to fund a growth agenda. We have introduced ARGA European Equity into the model, a value-focused investment house which should capture a cyclical upturn in European growth. The worst performer was Alger Focus Equity, a fund which dominated 2024’s performance tables.”
Silvia Tenconi
Multimanager Investments & Unit Linked, Eurizon Capital SGR.
Based in: Milan, Italy
“In February, the performance of the portfolio was positive, with Wellington Strategic European Equity contributing most.Credit markets rose, interest rates fell in the US and moved sideways in Europe. Equity markets rose in the eurozone, while US equities entered a negative phase. In the US, the earning season drew to a close with strong results, yet corporate confidence began being dented by Donald Trump’s trade policy gaining momentum and inflation expectations rose. We keep our balanced exposure to equities, high yield, US dollar and Italian government bonds.”
Richard Troue
Fund Manager, Hargreaves Lansdown Fund Managers.
Based in: Bristol, UK
“It has been a chaotic start to the year, in geopolitical terms at least. While the unpredictability of a Trump presidency was a given, the to-ing and fro-ing over tariffs and defence has sparked volatility across global markets. I don’t need a crystal ball to see that there could be more of the same ahead. So, from a portfolio perspective, I’m going to hold steady for now and see how things play out. We’ve got a good blend of styles and some of our value-focused managers have recently provided a boost to performance as growth has rolled over. The whole idea of running a diversified, relatively core, portfolio is to avoid knee-jerk changes based on short-term and unpredictable news flow. Let’s see what the next few months bring!”
Paul Hookway
Senior Fund Analyst, Kleinwort Hambros.
Based in: London, UK
“In the short-term Trump’s policies have caused a material sell off US equities, with UK and European markets the principal beneficiaries. Weakening US data in the short also weighed on sentiment. While we view this is as a short-term issue we have decided to reduce our US exposure by selling our holding of Pictet Global Environmental Opportunities. This has a strong bias towards US markets and has been impacted by its environmentally focused strategy. In its place we are adding a holding of iShares Core MSCI Europe ETF, increasing our UK and European exposure. We view this as a shorter-term tactical trade.”
Antti Saari
Chief Investment Strategist, Nordea investments.
Based in: Copenhagen, Denmark
“During the first two months of the year, global equities performed rather ok in euro terms, but uncertainty is high as President Trump has followed through on some of his campaign promises. The global economy has proven resilient, particularly driven by strong growth in the US. Moreover, forecasts are still indicating a healthy growth outlook. However, equity markets have already priced in supportive conditions, and only limited trade disruptions. Waiting for more clarity, we keep our neutral allocation between equities and bonds. Within bonds, we continue to overweight investment grade versus government bonds. Although credit spreads are rather low, we do not expect much widening as long as the economic outlook remains solid and hence, the small spread is still worth harvesting.”
Didier Chan-Voc-Chun
Head of Multi-Management and Fund Research at Union Bancaire Privée (UBP).
Based in: Geneva, Switzerland
“The global growth outlook is facing challenges due to rising costs. This is being driven by factors such as US presidential decrees and new trade restrictions with Canada, Mexico, and China, as well as the impact these will have on the copper price and maritime trade. However, the outlook for US industries may improve once tariff uncertainties are resolved, tax cuts take effect, and regulations are relaxed. The Federal Reserve is expected to continue its pause in interest rate changes during the first half of the year. In response to this, we have slightly reduced equity exposure in favour of fixed income investments in an effort to better manage risk.”
