Hamish Douglass, the CEO, CIO and Lead Portfolio Manager (Global), discusses why capital preservation is important, gives his five biggest risks for global markets and explains why he is cautiously optimistic about President Donald Trump’s pro-growth.
"We're sitting at 15% cash. As rates go up, we think we're going to find more value to redeploy that in assets. In particular, in what you'd call the 'bond-proxy'-type equities, which react to longer-term interest rates going up."
Risks to the current bull market
Discussion on key risks starts at the 6.07 minute mark in the video above.
- Stability of the Renminbi. If China loses control of its currency, it could destabilise the region.
- Political risk in North Korea. If Pyongyang is successful in developing ICBM capabilities, it could materially change the psychology of geopolitics.
- Political instability in Europe. Particularly the French elections in May.
- The unwinding of global monetary policy. If the Fed is forced to raise rates faster than expected, it could create instability in markets.
- Trump, his policies, and how he'll handle the relationship with China.
Learn more about the Magellan Global Fund here.