Twitter icon Email alerts icon Latest News RSS icon Magazine icon Stay connected:

View the article online at http://citywire.co.uk/wealth-manager/article/a654667

Veritas' Meg Woods: identifying the 2020 winners

by Meg Woods on Jan 30, 2013 at 10:32

The expansion of the global middle class means emerging market consumption could make up an astonishing two thirds of the world’s total by 2050, according to Karen Ward and Frederic Neumann at HSBC.

Furthermore, the savings surpluses of the emerging world that have financed the current account and budget deficits of the West look set to continue.

Barclays 2012 Equity Gilt Study estimates that in 2002 the gap between international foreign exchange reserves and ‘safe haven’ bond issuance was a chunky 35% of global GDP, the gap being funded by the private sector. The gap has now fallen to only 12%, and is projected to remain broadly at that level through to 2021, even allowing for sizeable Western government issuance.

A gap of this order should be readily funded by the private sector. Those looking for an early return of interest rates to normality may be disappointed.

At Veritas, this approach of looking through the current malaise to what the world will look like in 2020 and beyond is the fabric of our current investment strategy. ‘Rising tide, 2020 winners’ is our core conviction theme at present.

We are constructive that the eurozone, the US and China will, step by step, work their way through their issues, but we are not going to speculate on timing nor on the inevitable attendant volatility in markets.

Rather, our strategy is to ferret out those sound businesses with a competitive edge and global perspective that we believe will become winners by 2020, and in which we can invest on a sensible valuation. Despite the challenging backdrop, there are opportunities.

Sign in / register to view full article on one page

leave a comment

Please sign in here or register here to comment. It is free to register and only takes a minute or two.

News sponsored by:

Sponsored Video: Bringing it all back home


As the UK coalition government strives to rebalance the national economy, so called 'reshoring' looks set to play an increasingly important role in economic recovery.

Today's top headlines

Sponsored Video: Barings on investing in Frontier Markets


From Nigeria to Pakistan and from Kenya to Kuwait, frontier markets are catching investors' attention as never before.

More about this:

Archive

On the road

Click here to find out more from the Audience Development team.

Sorry, this link is not
quite ready yet