INDOSUEZ Asset Management, the fund group with about US$45 billion under management, is strengthening the exposure of its global funds to United States bond and equity markets in anticipation of a recovery.
Jean-Claude Kaltenbach, chief investment officer for its worldwide operation, said yesterday the flight of capital to quality markets over the next six months would boost the positive sentiment from a strengthening dollar and plateauing interest rates.
The recovery would be accelerated by expanding Japanese exports trimming the US trade deficit while technical factors, such as United States corporations buying back around $65 billion of their own stock, would increase demand for stocks.
Asset allocations for global US-dollar denominated portfolios, which are typically used for institutional portfolios with a minimum of $10 million, are being reviewed in response to the anticipated turnaround.
The portfolio is currently underweight in equities and overweight in bonds with 48 per cent in equities, 47 per cent in bonds and five per cent cash against benchmarks of 50 per cent, 40 per cent and 10 per cent respectively.
While underweight in US equities, it is intended to increase the exposure by at least 5.5 per cent, or 19.4 per cent of the portfolio.
