We are starting 2023, which could be an opportunity to optimize, diversify or maintain the portfolio. We come from a very turbulent 2022 and this new year presents quite a few challenges, but also opportunities and desires to fulfil, always depending on the profile, interests and theme of the investor.
Firms that seek to offer attractive returns with a high-conviction model, such as Aperture Investors, put emerging markets (debt, stocks and currencies) in their pools this year, which are positioned to experience a rally after months in the shadows of a strong dollar and rate hikes, without forgetting that there are opportunities in the dispersion and inefficiencies of the credit market. Finally, European stocks with a strong innovation imprint in their business philosophy will also be attractive to build portfolios in the coming year.
For those who prefer liability-based investing and multi-asset portfolio management, such as Generali Insurance Management, keep an eye on the “reopening” of China and the hopeful relaxation of its zero-covid policy. This is positive news for all stocks with significant exposure to the area: luxury, auto, technology… and energy and raw materials, as China is the world’s largest consumer of energy and raw materials. Any opening would significantly increase the demand and would be an opportunity.
There are firms that focus on diversification by asset classes and geographies as a guideline for the new year that leaves behind the difficulties of the markets in 2022. This group includes Generali Investments, which identifies opportunities in different assets, such as fixed income, and a favorable environment for multi-asset strategies.
In the “new normal”, inflation will no longer be a temporary phenomenon linked to strong post-pandemic demand or a more difficult supply chain; It will probably be a more structural issue in the macroeconomic outlook and more relevant in the investment decision process, with central banks recovering their role as guarantors of price stability.
On the other hand, and from the point of view of Generali Real Estate, real estate investment seems to be one of the most desirable markets. 2023 will mean a return to the offices, but not in any format… times have changed and so have labor needs. Energy efficient, comfortable, safe and well-connected spaces are needed.
From the real estate sector, we make the leap to that of infrastructures, a specialty of Infranity. According to the specialists of this manager, the great protagonists of this sector, given its enormous potential, are the energy revolution and the digitization of society. both investment ideas are reinforced after the most recent geopolitical risks.
For the investor who opts for highly liquid alternatives, there is Lumyna. From this point of view, one of the most outstanding lessons of 2022 is the importance of decorrelating portfolios with alternative assets when debt and equities are in a downward alliance. Credit and the energy transition are emerging as drivers of profitability for the most diversified investors.
For those looking for absolute returns with a solid strategy based on multi-asset investments, Plenisfer Investments recommends being aware of the macro environment. We are in a moment of economic, energy and perhaps political transition that offers different opportunities for investors, including those related to the scarcity of raw materials necessary for the transition (copper, nickel, zinc, etc.). On the other hand, regarding the traditional energy sector, we believe that the strong investments in oil extraction and refining made in the last decade have produced a structural increase in profitability that, in the absence of new investment plans, may translate into good results.
ESG and SRI investments are indisputable values for a growing number of investors and therefore the focus must be energy, not only renewables, but also energy efficiency, green mobility, renovation, construction, and the circular economy, elements that will enable the transition to a lower carbon economy, according to Sycomore AM experts. Also, albeit cautiously, there are alternatives in the energy sector, such as hydrogen or carbon capture, use and storage (CCUS), which represent a small part of the economy and have only a marginal impact on total emissions.
Other sectors that will benefit in 2023 are the sustainable management of natural resources (forests, water…) and environmental services.