Tom Becket, the chief investment officer of PSigma Investment Management, says his team has been moving to a more defensive/absolute return strategy to counter growing volatility in markets.
Becket says that over the last 18 months, it has served them well to be long risk but says it is clear that equities as well as other asset classes are no longer as attractive as they were.
Becket says funds across the range are now closer to 50% invested in equities, having previously been 55-60%. His team has also cut its exposure to high-yield credit. The group invests almost solely in the Investec Enhanced Natural Resources fund for its resources exposure. (article continues below)
Becket says: “In the last few weeks, we have seen a sovereign debt crisis in Europe, chaos caused by the second round of quantitative easing and China’s desire to cool the current inflationary pressures and the market has taken them in all in its stride. You could see that as a positive but what if people start to price these issues back into the market?”