Description: The article is about ubs login. The Chief Investment Office (CIO) invites thought leaders to debate the key topics affecting financial markets,and to challenge the UBS House View. The investors felt that valuations are too stretched and there may be better equity regions to invest in currently.
Welcome to the UBS investor forum. Every month we bring in outside investors to debate and challenge our views and this is a time when views seem to be particularly disparate,let’s get to the discussions.
U.S. tips make a lot of sense,the utility we have from the youth administration and where do we go for fiscal stimulus or where do we go for protectionism will result in higher inflation,it seems to be the safest bet at a moment. Being long tips is better than being long nominals,but you can still lose.
We continue to stay cautious,we are very selective but still relatively investing in US. There is going to come a time in a place where you wish you had never learned the meaning of the word high-yield,it typically happens. One of the big risks to the high-yield market as it exists in the US ironically isn’t because of a huge build in leverage in the US high-yield market,it has been more restrained in this cycle.
The risk is that the investment-grade market has partied. We are bullish in terms of US equity risk assets and in terms of the dollar. My fear is it depends on what has got us here in terms of valuations. There seems to be this sense that Trump is going to deliver a step up in terms of growth.
The repatriation of profits will lead to a big wave of capex spending,that’s where I have my doubts,these are rational actors,if the US were a great investment environment,these companies would do it anyways.
We can still see euro dollar while US is getting weaker and heading towards a parity,that’s more reflection of the way that we’re primarily thinking about the US. US short rates are mispriced that the markets pricing is still less than two rate hikes during the course of this year.
I think it’s good to be euro against the dollar,I think it’s very non consensus. It is expressing the balance of risks,I think you need a lot of good news to push the dollar even higher. Everybody is focusing on monetary policy divergence,it seems to be well on price.
Valuations are quite stretch,if you look at it versus real yields which has been a good driver of your dollar over the last few years,your dollars may look weak. When we heard a range of views on how the politics and the economics are going to come together in 2017,for our part we start the year overweight in risk assets and we like the euro over the dollar.