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Thursday, April 1, 2010
Avoiding fixed assets

International markets saw positive returns during 2009. But on a three-year basis, the performance has been generally negative with only the J.P. Morgan Global Government Bond Index and cash (US dollar) showing positive returns.

In most advanced economies equity and property markets performed well last year, but cash and bond returns lagged considerably, observes Simon Pearse, CEO of Marriott Asset Management.
The outlook for the various asset classes is mixed. “Equity and property markets are still attractive while fixed interest assets should be avoided.”

International Real Estate

During 2009 Marriott Asset Management actively promoted quality international real estate as the income streams had become attractive with forward yields exceeding 6%. The GPR250 Real Estate Index returned 34% last year. “We are still of the view that this asset class is offering good value with forward dividend yields exceeding 5% and income growth being supported as the developed economies come out of the recession. We remain confident that exposure to the Marriott International Real Estate Fund will benefit investors,” says Pearse.

 

International Bonds. With a general expectation of rising inflation in the global markets, it would be prudent to avoid US treasuries and long bonds in general.
International First World Large Cap Equities. There has been a marked recovery in the first world economies with equity markets having performed well during 2009. There is still real value in selected large capitalisation companies in the US, UK and Europe as the dividend yields remain high at around 4% and are supported by reliable dividend streams.

Copyright © Insurance Times and Investments® Vol:23.4 1st April, 2010
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