- Central banks are set to reduce their interventionist
approach
- Productivity will increase despite an aging workforce
- Next recession expected around mid-2020
- Governments to relax their focus on regulation, consider
protectionist policies
- Non-traditional strategies on track to offer best
risk-reward
For more media materials please visit:
https://www.multivu.com/players/English/8187051-fiera-capital-financial-forecast/
MONTREAL, NEW YORK and LONDON, Sept. 27,
2017 /PRNewswire/ - Fiera Capital Corporation (TSX:
FSZ) ("Fiera Capital" or the "Firm"), a leading independent asset
management firm with more than C$125
billion (approximately US$ 100
billion) under management, released today its first
Global Financial Forecast 2017-2024 ("Report"). Looking
ahead seven years, the usual length of an economic cycle, the
forecast seeks to provide guidance for investors who are seeking
both to structure their portfolios within the current market
environment and prepare for future policy developments.
Francois Bourdon,
Global Chief Investment Officer, commented: "Over the last
seven years, the global economy has taken significant strides to
recover from the 2008 credit crisis. Financial markets have been
driven by extraordinary actions from central banks, a thirst for
yield, falling productivity and a prolonged expansion characterized
by very low inflation. Following this unusual period we expect the
next seven years to be characterized by a return to a more
traditional business cycle, in both central bank activities and in
productivity. An aging population should continue to drive
investors towards income, and politics are likely to have a greater
impact than usual."
Five Key Global Drivers
The Report outlines five key
global trends that may influence and characterize the investment
environment over the next seven years. These are:
- Productivity: Productivity is expected to improve from
current levels as local economies leverage advances in technology
including artificial intelligence and the increased use of
robots.
- Demographics: We believe that an aging population will
have a negative impact on growth while the higher dependency ratio
will spur inflation.
- Business Cycle: While a recession is not expected in the
next couple of years, one could be expected after 2020 - and an
accompanying recovery - within the next seven years, if it follows
previous cycles. The path towards recession will likely come from a
tightening of credit from central banks as the current cycle
becomes more mature and inflation pressures warrant higher interest
rates.
- Central Banks: We believe the role of central banks will
decrease over time as the global economy normalizes.
- Politics: As the ghosts of the previous crisis are
forgotten, governments are expected to relax their focus on
regulation in order to improve efficiency and productivity.
However, protectionist temptations and the ongoing focus on
nationalism among politicians of various affiliations is likely to
continue.
Regarding politics, Jonathan
Lewis, Chief Investment Officer, U.S. Division,
commented:
"Political risk in the US is rising, geopolitical
tensions are escalating, and it is unclear whether this untested
Administration is prepared for the challenges ahead. These risks
are difficult for markets to assess, and so the markets have chosen
to ignore them. Overvalued markets and undervalued risks are an
unhealthy combination."
Four Key Financial Market Factors
Four key factors are
identified in the Report which we believe are set to impact
financial markets going forward:
- Growth: An increase in consumer demand will spur growth
levels, with economies expanding across most geographies. Growth in
the U.S. is expected to approach three percent, on a par with its
historical average.
- Inflation: Investors can expect higher rates of
inflation over the next seven years. As a result of past monetary
policy decisions starting to have an impact on stimulating demand,
the global economic focus will shift from deflationary fears
towards inflationary pressures. Inflation in the U.S. is predicted
to rise to 2.5 percent.
- Valuations: Valuations may normalize towards 2024, with
interest rates expected to rise to the 4-5 percent range as we
escape progressively from the current unusual period of emergency
interest rates and low inflation.
- Liquidity: Given lower levels of central bank activity,
liquidity will be reduced progressively.
How to structure your portfolio for the future?
The
Report also provides information on how investors may want to
structure their portfolios to meet their investing goals:
- For investors seeking income, non-traditional asset classes
such as core agriculture, core infrastructure, private lending may
offer compelling performance. Also, preferred shares and high-yield
bonds have the potential to perform well within traditional income
options.
- For investors seeking capital gains, private equity and
long-short equity are expected to provide better returns. In
traditional equity markets, large-cap emerging and large-cap
frontier are expected to outperform large cap developed markets and
mid cap global asset classes.
Julian Mayo, Senior Vice
President and Investment Strategist, Charlemagne Capital, European
Division, commented: "After five difficult years, emerging
markets started transitioning in early 2016 and now reflect a more
positive outlook. Their recovery is fairly robust and broad based
and we believe this asset class should perform well over the next
few years."
Important Disclosures
The information and opinions
expressed herein and the Report are provided for informational
purposes only, are subject to change and should not be relied upon
as the basis of any investment or disposition decisions. Past
performance is no guarantee of future results. All investments
pose the risk of loss and there is no guarantee that any of the
benefits expressed herein will be achieved or realized.
The information provided herein and in the Report does not
constitute investment advice and it should not be relied on as
such. It should not be considered a solicitation to buy or an offer
to sell a security. It does not take into account any investor's
particular investment objectives, strategies, tax status or
investment horizon. There is no representation or warranty as to
the current accuracy of, nor liability for, decisions based on such
information. Any opinions expressed herein or in the Report
reflect a judgment at the date of publication and are subject to
change. Although statements of fact and data contained in this
press release and the Report have been obtained from, and are based
upon, sources that we believe to be reliable, we do not guarantee
their accuracy, and any such information may be incomplete or
condensed. No liability will be accepted for any direct, indirect
or consequential loss or damage of any kind arising out of the use
of all or any of this material.
Certain information contained herein and in the Report
constitutes "forward-looking statements," which can be identified
by the use of forward-looking terminology such as "may," "will,"
"should," "expect," "anticipate," "project," "estimate," "intend,"
"continue," or "believe" or the negatives thereof or other
variations thereon or comparable terminology. Due to various risks
and uncertainties, actual events or results or the actual
performance may differ materially from those reflected or
contemplated in such forward- looking statements.
Views expressed regarding a particular company, security,
industry or market sector should not be considered an indication of
trading intent of any funds or accounts managed by any member of
the Fiera Group of companies. For more information please also
consult the Report at the link set out above.
Each member of the Fiera Group of companies only provides
investment advisory services or offers investment funds in the
jurisdictions where such member and/or the relevant product is
registered or authorized to provide such services pursuant to an
exemption from such registration. These include the entities
listed below. Where an entity operates under an exemption from
registration (the "Exempt Entities"), only its jurisdiction of
incorporation is listed. Details on the particular
registration and offering exemptions for the Exempt Entities'
activities are available upon request.
- Fiera Capital Corporation – Canada, registered: (i) in the categories of
exempt market dealer and portfolio manager in all Provinces and
Territories of Canada (ii) in the
category of investment fund manager in the Provinces of
Ontario, Québec, Newfoundland and Labrador; (iii) as a commodity trading manager
pursuant to the Commodity Futures Act (Ontario), (iv) as an adviser under the
Commodity Futures Act (Manitoba)
and, (v) in Québec, as derivatives portfolio manager pursuant to
the Derivatives Act (Québec);
- Fiera Capital Inc. – United
States, registered as (i) an investment adviser with the
U.S. Securities and Exchange Commission (the "SEC")* and (ii) a
commodity pool operator with the U.S. Commodity Futures Trading
Commission.
- Bel Air Investment Advisors LLC—United States, registered as an
investment adviser with the SEC*.
- Charlemagne Capital (UK) Limited – United States, registered as an investment
adviser with the SEC*. United
Kingdom, authorized and regulated by the Financial Conduct
Authority.
- Charlemagne Capital (IOM) Limited – United States, registered as an investment
adviser with the SEC*. United
Kingdom, licensed by the Isle of Man Financial Services
Authority.
- Charlemagne Capital Limited – A company registered in the
Cayman Islands.
- Fiera Properties Limited – A corporation incorporated under the
laws of the province of Ontario
(Canada).
- Fiera Private Lending Inc. – A corporation incorporated under
the laws of the province of Québec (Canada).
- Fiera Infrastructure Inc. – A corporation incorporated under
the laws of Canada.
- Fiera Comox Partners Inc. – A corporation incorporated under
the laws of Canada.
*Registration with the SEC does not imply a certain level of
skill or training.
About Fiera Capital Corporation
Fiera Capital is a
leading independent asset management firm with more than
C$125 billion in assets under
management as of June 30, 2017. The
Firm provides institutional, retail and private wealth clients with
access to full-service integrated money management solutions across
traditional and alternative asset classes. Clients and their
portfolios derive benefit from Fiera Capital's depth of expertise,
diversified offerings and outstanding service. Fiera Capital trades
under the ticker FSZ on the Toronto Stock Exchange.
www.fieracapital.com
In the U.S., asset management services are provided by the
Firm's U.S. affiliates, Bel Air Investment Advisors LLC and Fiera
Capital Inc., investment advisers that are registered with the U.S.
Securities and Exchange Commission (SEC). Further, Charlemagne
Capital (UK) Limited and Charlemagne Capital (IOM) Limited are both
registered as investment advisers with the SEC. Charlemagne Capital
(UK) Limited is authorized and regulated by the Financial Conduct
Authority in the United Kingdom
and Charlemagne Capital (IOM) Limited is licenced by the Isle of
Man Financial Services Authority. Registration with the SEC does
not imply a certain level of skill or training. Additional
information about Fiera Capital Corporation, including the Firm's
annual information form, is available on SEDAR at
www.sedar.com.
SOURCE Fiera Capital Corporation