French-based global private bank sees opportunity ahead for investors
Less than a month into 2020 the landscape of political and economic uncertainty continues, as it did last year.
But what will be the big themes for investors this year?
According to global private bank BNP Paribas there are 10 key themes to be aware of to ensure investors are best-placed to maximize returns on their assets.
First, three for those investors that prefer a more conservative risk profile.
These include a shift from bonds to equities, which should be attractive for investors looking for steady income, but they will need to accept higher volatility than in the bonds market and invest for the long term.
Picking stocks in companies with high profitability, low gearing, and low profit variability should provide some defence to economic shocks.
And portfolio diversification is also recommended with a mix of low-risk and calculated-risk products.
Global trends
For investing to take advantage of global trends, the bank suggests hedging portfolios with safe-haven assets to mitigate the impact of a reversal of global trade.
It also sees opportunity in investing in infrastructure with spending expected to increase.
The environment – specifically water and waste management – are key growth areas and BNP Paribas says that investors’ growing interest in ESG criteria should help drive this.
Investing in human capital, including selecting companies that are ranked best for workplace equality; and those that are in the healthy food and food security spaces should thrive.
Disruptive players
The report also suggests that investing in disruptive industries could pay off.
These include artificial intelligence, 5G, digital consumption, and healthcare innovations.
