Trustnet Magazine Issue 48 FEBRUARY 2019 | Page 20

Advertorial feature
[ JANUS HENDERSON ]
20 / 21
With a number of headwinds facing markets in 2019,
it can be hard to see the wood for the trees.
Alex Crooke, fund manager of The Bankers
Investment Trust, explains how his team approaches
the complexities of global stock markets
Banking on
diversification
A
s we move further into
2019, there are plenty of
reasons for investors to be
cautious, as ever, but more
often than not the situation turns out
less gloomy than we are led to believe.
Talk of a global recession is cropping
up more and more, not least because
it’s been 10 years since the global
financial crisis. We’re not convinced at
The Bankers Investment Trust that a
global recession is imminent, because
conditions are very different from just
before the last downturn in 2008.
pound and local
equities. Brexit
has fogged
the country’s
corporate landscape as it prepares
for life outside Europe’s political
and economic union and the
pessimism towards UK equities is
unprecedented.
Across the Atlantic, the US has enjoyed
a long-running bull market, buoyed
early last year by President Donald
Trump’s corporate tax cuts. Those cuts
were significant in scale and raised
plenty of eyebrows when considered
Causes for concern
in the context of the country’s eye-
It’s fair to say there are a number of
watering national debt of more than $20
significant forces at play that could
trillion.
have meaningful consequences
President Trump’s campaign to
for markets. Here in the UK, the
renegotiate trade tariffs has also been
country’s exit from the EU has already hogging the headlines. The so-called
affected both the exchange rate of the ‘trade war’ with China has brought
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about political tensions between the
world’s two largest economies that are
certainly not helpful in stimulating
global trade.
Beyond these headlines, there are
other very important considerations
for investors, such as the reversal of
quantitative easing measures by major
central banks around the world – so-
It would be a mistake to
become too bearish too
early, and in our opinion
the classic indicators of an
impending global recession
are not present
called quantitative tightening – as
well as the ongoing and hastening
influence of disruptive technology
on established business models and
the disparate fiscal policies between
developed nations.
It is important to be mindful of these
factors, but it would be a mistake to
become too bearish too early, and in
our opinion the classic indicators of
an impending global recession are not
present.
For example, it is currently hard to
see the signs of excess that typically
precede global economic recessions.
Bank lending to corporates and
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