Funds Hub
Money managers under the microscope
Light at the end of the tunnel?
There’s no shortage of bad news in the financial world at the moment.
But one top hedge fund manager believes that equities could soon be heading for a very sharp rally.
Cazenove’s Neil Pegrum — whose fund made 9.4 percent last year while markets were plummeting — believes UK equities could soon be enjoying a “March 2003″ rally.
While it seems a long time ago now after the market’s recent woes, March 2003 marked the start of a 4-year bull market which took the FTSE 100 from less than 3,300 to more than 6,700 and saw clever stockpickers reap huge rewards.
Pegrum argues that stocks are already discounting a lot of bad news. He adds that equities look forwards rather than backwards and therefore, as in March 2003, can rally even as analysts are still downgrading corporate earnings forecasts.
A pretty pair
The shrinkage of the UK-listed banking sector is providing an interesting trade for Legal & General Investment Management’s $46 million Global Macro fund.
After some dramatic share price falls, banks now account for only around 10 percent of the FTSE 100. According to LGIM’s head of asset allocation David North, this means any potential damage of further bank problems to the index is likely to be a lot less from here onwards.
