We believe the U.S. economy is stronger than most people believe it to be,said Steve Brice,Chief Investment Strategist at Standard Chartered Bank.We do believe we're in a more constructive risk environment,but it's not gonna be a straight line,in our opinion.
We are overweight global equities.The dividend yield in the U.S.,Japan and Germany is significantly above government bond rates.It makes total sense from a global equities perspective.We are also overweight corporate debt.We are overweight the U.S.,China and Korea.We do see high dividend yields in Malaysia,Mr.Brice added.
The case for buying Europe is based on the sentiment being awful;cheap valuations;shares trading at a 49% discount,versus a 20% premium in the U.S.;and the dividend yield at a 320 point spread to the German bund,according to Katie Koch of Goldman Sachs Wealth Management.The smart thing is to initiate or add to positions;but keep some dry powder.Up to 25% could be in emerging markets;the other 75% will include some exposure to emerging markets,which means you will have over half of your return from emerging markets,Ms.Koch explained.
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