Global Multi-Asset Investment Strategist, True Insights

Jeroen Blokland

Global Multi-Asset Investment Strategist

Build Well-Diversified Multi-Asset Portfolios

True Insights

Our research helps investors build well-diversified multi-asset portfolios and profit from market developments. In addition, our unique and proven Macro – Sentiment – Valuation (MSV) investment framework ensures a consistent flow of new investment opportunities. Together with our market views, these opportunities will be reflected in our live ETF-based Global Multi-Asset Portfolios.

Cross Asset Strategy

<ul>
<li>We have lifted the weight of Developed and Emerging Market Equities to Neutral and raise Bitcoin to Overweight.</li>
<li>The catalyst for these portfolio decisions is the Federal Reserve, which strengthened the dominant market driver being the combination of Federal Reserve rate cuts, a soft landing, and ample liquidity.</li>
<li>Bitcoin is also one of the beneficiaries of growing worries about the speed of debt accumulation. In addition, the impact of US spot Bitcoin ETFs may drive Bitcoin’s price higher.</li>
</ul>


We have lifted the weight of Developed and Emerging Market Equities to Neutral and raise Bitcoin to Overweight.
The catalyst for these portfolio decisions is the Federal Reserve, which strengthened the dominant market driver being the combination of Federal Reserve rate cuts, a soft landing, and ample liquidity.
Bitcoin is also one of the beneficiaries of growing worries about the speed of debt accumulation. In addition, the impact of US spot Bitcoin ETFs may drive Bitcoin’s price higher.


Portfolio Changes – Fed Exuberance = Equities Neutral, Long Bitcoin

<ul>
<li>In the past four months or so, stock prices haven’t done all that much. The MSCI World Index measured stands 1.5% higher than at the beginning of July.</li>
<li>However, cash has performed just as well as equities, or even slightly better in the case of the MSCI World Index, with much lower risk.</li>
<li>If we were to compare the Sharpe ratios (return divided by realized volatility) of stocks and cash over the past months, the gap between the two categories would be huge.</li>
</ul>


In the past four months or so, stock prices haven’t done all that much. The MSCI World Index measured stands 1.5% higher than at the beginning of July.
However, cash has performed just as well as equities, or even slightly better in the case of the MSCI World Index, with much lower risk.
If we were to compare the Sharpe ratios (return divided by realized volatility) of stocks and cash over the past months, the gap between the two categories would be huge.


Investing Is About Return and Risk – Update 34027

<ul>
<li>Our estimate of the fair value 10-year US Treasury yield currently stands at 4.63%.</li>
<li>With a difference of 38 basis points, the gap between the fair value estimate and the actual yield is historically large.</li>
<li>Hence, we adjust our portfolio and remove the overweight in Treasuries.</li>
</ul>


Our estimate of the fair value 10-year US Treasury yield currently stands at 4.63%.
With a difference of 38 basis points, the gap between the fair value estimate and the actual yield is historically large.
Hence, we adjust our portfolio and remove the overweight in Treasuries.


Cross-Asset Liquidity Strategist, CrossBorder Capital

Michael J. Howell

Cross-Asset Liquidity Strategist

Implementing Research Using Alt Data & AI

CrossBorder Capital

CrossBorder Capital is a London-based independent investment advisory firm. Founded in 1996, it exploits a gap in the investment arena by focusing on Central bank liquidity. 

It specialises in the monitoring and analysis of global liquidity flows - an important determinant of asset prices, from currencies through to bonds, equities and real estate.

CrossBorder Capital implements its investment strategy and currently manages over US$ 350m.


<ul>
<li>Everything is bottoming! Global Liquidity, stock markets, bond term premia, the World economy and even inflation pressures</li>
<li>We remain upbeat towards risk assets , but must acknowledge that the big gains are likely over for a while given gathering duration tensions in bond markets</li>
<li>The Global Liquidity cycle and asset allocation are unfolding on track in 2023. It is leading the World economy and currently sit in its Rebound investment phase</li>
</ul>


Everything is bottoming! Global Liquidity, stock markets, bond term premia, the World economy and even inflation pressures
We remain upbeat towards risk assets , but must acknowledge that the big gains are likely over for a while given gathering duration tensions in bond markets
The Global Liquidity cycle and asset allocation are unfolding on track in 2023. It is leading the World economy and currently sit in its Rebound investment phase


Global Liquidity: Where Are We In The Cycle?

<ul>
<li>Volatility Has dropped off a cliff, signaling that investors are unable to see any risk currently. That feels at least a bit complacent. </li>
<li>We take a deep dive to determine which asset class will likely benefit most from the first Fed rate cut and the start of the easing cycle. Spoiler alert! It’s not Equities.</li>
<li>OPEC’s resilience to continue production cuts is being tested. At the same time, our Fear &amp; Frenzy Sentiment Index has moved even further into FRENZY territory.</li>
</ul>


Volatility Has dropped off a cliff, signaling that investors are unable to see any risk currently. That feels at least a bit complacent. 
We take a deep dive to determine which asset class will likely benefit most from the first Fed rate cut and the start of the easing cycle. Spoiler alert! It’s not Equities.
OPEC’s resilience to continue production cuts is being tested. At the same time, our Fear &amp; Frenzy Sentiment Index has moved even further into FRENZY territory.


The Weekly Market Monitor – VIX Hits Multi-Year Low, Investors Can’t See Any Risks!

United States

The MSCI World Index is a free-float weighted equity index. It was developed with a base value of 100 as of December 31, 1969. MXWO includes developed world markets, and does not include emerging markets. MXWD includes both emerging and developed markets.

MSCI World Index (MXWO INDEX)

Portfolio Changes – Fed Exuberance = Equities Neutral, Long Bitcoin

Powell gave investors everything they wanted. We raise the weight of equities and 'front-run' the Bitcoin halving while also adding to gold.

Jeroen Blokland

Investing Is About Return and Risk – Update 34027

The Weekly Market Monitor keeps you updated on the week’s most important charts and developments in financial markets. Investments highlighted:...

Jeroen Blokland

Bond Investors Are Overdoing It!

It was fun while it lasted. The gap between our fair value 10-year US Treasury yield and the actual yield has grown historically large. Hence, we...

Jeroen Blokland

Global Liquidity: Where Are We In The Cycle?

Understanding the Global Liquidity Cycle has proved valuable over the past few years. Reconsider this report which explains our asset allocation...

Michael J. Howell

The Weekly Market Monitor – VIX Hits Multi-Year Low, Investors Can’t See Any Risks!

The VIX collapsed to the lowest since COVID, which makes investors look complacent, especially with our Fear & Frenzy Sentiment Index still in Frenzy.

Jeroen Blokland