Despite the difficult political environment, things are beginning to look “less bad” on the macro front, says Nick Griffin, Head of Investments at Munro Partners. Emerging markets, Europe, resources, and banks have all recently bottomed out and beginning to improve, while Europe appears to be doing the same. “If you put all those macro pieces together, we see better macro-momentum next year… It’s a slightly better year next year, mainly because it’s just less bad.” So, what does this mean for growth investing? With improving growth comes the risk of higher inflation and higher interest rates, which can result in a reduction in the earnings multiple that investors are willing to pay; “we need to be much more vigilant about the multiples we’re investing at.” In the short video below, he explains why pricing power is so important in this environment.
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