Navigation Links
Barclays Wealth Recommends Increasing Exposure to Laggard Sectors Including Consumer Staples, Pharmaceuticals and Telecoms
Date:1/19/2010

NEW YORK, Jan. 19 /PRNewswire/ -- Barclays Wealth investment calls for this month include:

Increase Exposure to Non-Cyclical, Laggard Sectors; Maintain Exposure to US Small-Cap, Mid-Cap Equities

Now that the most dramatic phase of recovery is over, markets are moving into a new 'mid-cycle' phase, where returns are in 'normal' range and investors are paying more attention to valuations, particularly in the sectors overlooked in the initial "recovery/relief" phase.  

  • Raise exposure to non-cyclical equities – Consumer staples (particularly, food, beverage and tobacco), pharmaceuticals and telecoms – through sector ETFs or actively managed funds with a "Growth at a Reasonable Price" style.
  • Maintain exposure to the US small-cap and mid-cap sectors. We expect these stocks to make up for their atypically weak relative performance through the general market recovery to date.

Short Gold

We believe that gold is now significantly overvalued relative to fundamentals.

  • Investors should short gold in a way that limits possible losses as overvaluation may not correct immediately. Potential strategies include buying long-dated put options on one of the gold-based ETFs or a structured note.  

Seek to Benefit from a Gradual Renminbi Appreciation

The Chinese Renminbi (CNY) has been undervalued since the onset of the financial crisis, but looks set to appreciate in 2010.  Neighboring currencies also look cheap and should benefit from a stronger CNY.  

  • We recommend buying the South Korean Won (KRW), Indian rupee (INR), Indonesian rupiah (IDR), Singapore dollar (SGD) and Taiwan dollar (TWD).  Investing in local bonds could be an alternative, but local equities do not look cheap.  

Position Portfolio to Take Advantage of Potential Increase in M&A Activity

We think Merger and Acquisition (M&A) activity will return. The two common factors that make transactions more likely are healthy corporate balance sheets and inexpensive borrowing.  Borrowing is now easier and cheaper and most non-financial equity sectors do not look excessively leveraged.

  • To benefit we recommend investing with merger arbitrage hedge funds or using active long-only managers that seek to exploit M&A activity.

Aaron S. Gurwitz, Head of Global Investment Strategy at Barclays Wealth said:

"The most dramatic phase of the recovery is over and markets have stabilized, and we believe it is now important to focus on investment strategies that are effective in "mid-cycle" periods. Our only remaining "early cycle" call is to maintain exposure to U.S. small-cap and mid-cap market sectors. Our recommendation that investors should position to benefit from an eventual decline in gold prices reflects our expectation that the 2010 environment will gradually reassure market participants."

Michael Crook, Alternatives Strategist said:

"We now believe that gold is significantly overvalued relative to fundamentals due to the impact of demand for gold-based ETFs, an overpricing of the "fear premium" and confusion over how monetary policy works in a zero interest rate environment."

Brian Nick, Investment Strategist said:

"We see a resumption of Chinese renminbi appreciation likely in 2010 given the growing pressures on the Chinese government to revalue. If and when the renminbi moves, the other governments in the region will be more comfortable allowing their own currencies to strengthen, so we think investing in Asian currencies broadly is attractive at this time."

About Barclays Wealth

Barclays Wealth is a leading global wealth manager, and the UK's largest, with total client assets of $221 bn (pounds Sterling 134bn) as of 30 June 2009. With offices in 25 countries, Barclays Wealth serves affluent, high net worth and intermediary clients worldwide, providing international and private banking, investment management, fiduciary services, and brokerage.  For further information about Barclays Wealth, please visit our website www.barclayswealth.com.

Twitter page: www.twitter.com/barclayswealth

Barclays Group is a major global financial services provider engaged in retail and commercial banking, credit cards, investment banking, wealth management and investment management services with an extensive international presence in Europe, the Americas, Africa and Asia.

Barclays Wealth is the wealth management division of Barclays Bank PLC, functioning through Barclays Capital Inc. in the United States. Barclays Capital Inc., an affiliate of Barclays Bank PLC, is a U.S. registered broker-dealer and regulated by the Securities & Exchange Commission. Member SIPC.

SOURCE Barclays Wealth

RELATED LINKS
http://www.barclayswealth.com

'/>"/>

SOURCE Barclays Wealth
Copyright©2010 PR Newswire.
All rights reserved

Related medicine technology :

1. Commonwealth Fund Case Study Points to Continuous Innovation at Group Health Cooperative
2. US Expert Panel Recommends the Use of Fractional Exhaled Nitric Oxide (FENO) in the Diagnosis and Management of Asthma
3. RiskMetrics Recommends Taro Shareholders Vote Against Taro Board of Directors
4. PROXY Governance Recommends Against Taros Board and Supports Sun
5. ASM Recommends Nasopharyngeal Flocked Swabs as the Specimen of Choice for Influenza A Testing (Including H1N1)
6. CDC Advisory Committee Recommends Cervarix To Prevent Cervical Cancer in Girls and Young Women
7. Data Safety Monitoring Board Unanimously Recommends Continuation of Delcaths Phase III Clinical Trial
8. FDA Advisory Panel Recommends Approval of the SEDASYS(R) System
9. HIV/AIDS Research Network Recommends Use of Abbott RealTime Viral Load Test for NIH-Sponsored Clinical Trials
10. FDA Advisory Committee Recommends Approval of Multaq(R) (dronedarone)
11. Task Force Recommends Using Aspirin to Prevent Cardiovascular Disease When the Benefits Outweigh the Harms
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:6/26/2016)... Story Highlights: ... the health care industry is causing providers to review ... Deloitte offers a suite of solutions for health care ... cost optimization: labor resource analysis, revenue cycle optimization and ... outcomes and better economics ...
(Date:6/24/2016)... Calif. , June 24, 2016  Global ... a biopharmaceutical company developing novel therapeutics for the ... needs, today announced the closing of its previously ... common stock, at the public offering price of ... the offering were offered by GBT. GBT estimates ...
(Date:6/24/2016)... , June 24, 2016 ... the "Structural Electronics 2015-2025: Applications, Technologies, Forecasts" ... In-Mold Electronics, Smart Skin, Structural ... Structural electronics involves electronic and/or ... protective structures, replacing dumb structures such as vehicle ...
Breaking Medicine Technology:
(Date:6/25/2016)... City, Oklahoma (PRWEB) , ... June 25, 2016 ... ... helping both athletes and non-athletes recover from injury. Recently, he has implemented orthobiologic ... the Oklahoma City area —Johnson is one of the first doctors to perform ...
(Date:6/24/2016)... ... 2016 , ... A recent article published June 14 on E ... goes on to state that individuals are now more comfortable seeking to undergo not ... as calf and cheek reduction. The Los Angeles area medical group, Beverly Hills Physicians ...
(Date:6/24/2016)... ... ... Marcy was in a crisis. Her son James, eight, was out of control. Prone to ... , “When something upset him, he couldn’t control his emotions,” remembers Marcy. “If there ... my other children and say he was going to kill them. If we were ...
(Date:6/24/2016)... ... 24, 2016 , ... Dr. Amanda Cheng, an orthodontist ... has extensive experience with all areas of orthodontics, including robotic Suresmile technology, ... , Micro-osteoperforation is a revolutionary adjunct to orthodontic treatment. It can be used ...
(Date:6/24/2016)... , ... June 24, 2016 , ... People across the ... Genome magazine’s Code Talker Award, an essay contest in which patients and their families ... to be presented at the 2016 National Society of Genetic Counselors (NSGC) Annual Education ...
Breaking Medicine News(10 mins):