We're almost at the end of 2023. It's a complicated year due to rising interest rates, rising inflation, and the threat of economic recession in the United States and Europe. It is also complicated by geopolitics, with the war in Ukraine and the war between Israel and Gaza intertwined in full swing. What is the best job?
After a decade of strong growth, the world is in an economic environment vulnerable to inflation and geopolitical risks, as we have seen during and after the COVID-19 pandemic, the war in Ukraine, and the recent conflict in the Middle East. We can say that the best thing to do is diversification, of course, and being fully aware of the opportunities and risks involved in each investment. A diversified portfolio provides the best alternatives, and given the current uncertainty, we believe, even more so, that the golden age of high-quality investing has only just begun. The quality approach can be applied to both fixed and variable income.
Was variable income the biggest surprise this year 2023?
Investors looking to gauge the state of the US economy have faced mixed signals. Perhaps it is not surprising, then, that many investors turn to cash, or the assets it replaces, especially Treasuries, to protect capital. For example, many told us that they have accumulated 40% of their clients' portfolios in cash-like investments with maturities between three and six months. While this capital preservation process makes sense, it is time to question whether it is still valid as we appear to be reaching final rates. At these times, the opportunity cost of not investing can be high and hurt the portfolio in the long run.
Thinking about 2024, in what assets, in what regions and in what themes can we find opportunities?
Every investor has his or her own risk profile, needs and investment horizons, and for some the short term is more important than the long term. It is important for every investor to be clear about their investment objectives and be well aware of the risks and opportunities. Both fixed income and variable income offer attractive opportunities, precisely because of their diversification potential.
For a conservative investor seeking to preserve capital and control risk, what do you suggest?
High-quality fixed income as well as investment-grade credit are interesting alternatives. Another interesting proposal is multi-sector fixed income, which are investments that are able to adapt quickly to search for new opportunities and mitigate risks resulting from evolving market conditions. These strategies look for relative value across geographies, sectors, issuers and bond types, with the goal of generating alpha from a bottom-up and top-down approach. Obviously, the investor must be aware of the risks and ensure that he can bear them.
And for this saver who wants to integrate the stock market, can you give me two investment ideas?
US and global stocks offer interesting opportunities. The direction of interest rates remains a worrying factor for investors. Therefore, a quality-based growth strategy, where you invest in companies that are resilient in times of recession and successful in the long term, is very important.
Impact investing is also attractive. Investing in climate change mitigation is not only necessary to prevent its catastrophic effects – water stress or biodiversity loss, to name a few – but it also makes economic sense in the long term. For example, the Panama Canal Authority recently announced further reductions in ship traffic due to drought caused by El Niño, considered the worst in modern history.
“The quality approach can be applied to both fixed income and variable income.”
Nabil Al-Asmar Delgado. Country President of the Iberian Peninsula in Vontobel
Timing and diversification are important for building strong investment portfolios, but so is a good financial advisor. What does a financial advisor add to estate planning?
A financial advisor can guide investors in making decisions, taking into account each person's financial situation. Explain the risks and opportunities.
What is the benefit of integrating investment funds from an international manager like Vontobel into the portfolio?
Specialization As an active, multi-store manager, we are positioned to offer fixed income, variable income and multi-asset investment solutions. We are organized into six independent boutiques, each with its own investment philosophy.
As a manager, do you incorporate sustainability criteria into asset selection?
Yes. As a global investment firm, Vontobel plays a responsible and active role in the sustainable transformation of our society and economy. This is reflected in our governance, investment philosophy and operational processes. Many of our investment solutions focus on companies and sectors that contribute to sustainable transformation and manage the risks associated with it. In this way, Vontobel helps create new opportunities for investors.
From Vontobel, what are you doing to promote financial education among your clients?
Community financial education is key to ensuring an appropriate level of prosperity. As a committed manager, from Vontobel, we have been involved at local level in various activities, among which I would like to highlight the following three activities:
In collaboration with the sector association of which we are a part, and in collaboration with an NGO, we are participating in a program that imparts basic financial education to VET students to provide them with the tools that allow them to make appropriate decisions.
Likewise, with the help of a foundation, we collaborated on the preparation, publication and distribution of the book Cuidemos de nuestro Planeta, which aims to bring ESG and sustainable investing closer to children's audiences.
Finally, we collaborate monthly on a radio show focused on financial education where we uncover concepts that may be useful to private investors holding investments in financial products.
Full name of the director, headquarters and year of establishment:
Vontobel is headquartered in Zurich, Switzerland and was founded in 1924.
Assets managed globally and in Spain:
Globally, Vontobel manages approximately €220 billion.
In Iberia, the manager has assets under management of around €3,000 million. Data as of June 30, 2023.
Office opening date in Spain:
Presence and team at the national and international levels:
The Vontobel Asset Management team in Madrid serving the Iberian market includes six people. Internationally, Vontobel employs approximately 2,200 employees.
What they specialize in:
Vontobel Asset Management is an asset management company with a global reach and a multi-boutique approach. It has boutiques specializing in highly competitive solutions in both fixed income and variable income. Specifically, it highlights capabilities in North American equities, impact investing, corporate fixed income, and commodities.
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