The fall-out from the recent budget concerning welfare cuts has created a tailspin for the Tory party but in contrast, markets are relatively sanguine.
Most markets sectors enjoyed positive returns last week and now many stock-markets are at multi-week highs. The dollar has strengthened after a period of weakness which has been the signal for commodities to drift.
Commodities and emerging markets have been the strong performers since the lows of February 11th 2016.
At the start of the year the consensus trade was to invest in Europe but of late, money has moved from this sector in favour of markets with more momentum. This has created a more diverse outlook which has to be welcomed.
The question, as always is, “what’s around the corner”? Diversification doesn’t always work but having a broader spread of investments increases the probability of protecting capital. The key then, is to spot opportunities without wildly skewing ones’ investment risk.
