David Aujla

Our framework remains in a contraction regime which is defined by a period of below-trend and decelerating global growth. We therefore maintain a cautious asset allocation, overweighting fixed income relative to equities. Within equities, we remain committed to ensuring our portfolios are not overly dependent on the US, thus maintaining a diversified exposure to global markets. In fixed income, we underweight credit risk and overweight duration, favouring investment grade and sovereign fixed income relative to high yield. Given the decelerating growth environment and credit spreads at cycle lows, we believe the risk-reward in this position is attractive.

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