Financial Symposium 2023 (VIP)

We’ve entitled our 2023 Investment Outlook “Parallel Worlds” to reflect some different realities which confront investors in 2023 – that is to say, different economic trends in different parts of the world, a different economic environment versus what we have become accustomed to in the 2010s, and some big and important shifts in market valuations, which we think really change the game for investors.

Despite the recent rally in stocks, our house views continue to reflect an overall selective stance and we don’t advocate an aggressive use of risk budgets early in the year. Bonds seem to be the natural asset at this point in the economic cycle and market cycle. Shorter-term bonds are preferred for now, in our view, to protect against interest rate risk and uncertainty. That is because values of longer term bonds are most sensitive to interest rates changes. We also want to be selective and focus on higher quality bonds, given a potential recession could cause more pain for weaker firms.

For equities, the big risk remains corporate earnings downgrades. We have a preference for the US over Europe on a 12-month time horizon. Value, or stocks whose price is based more on current earnings than future growth, still makes sense as interest rates continue to rise. Likewise, we also prefer stocks of companies with more durable earnings across economic cycles.

Please join our invited speaker, Mr. Alexander Davey, for our 2023 Investment Outlook event on 16 February. This will be our inaugural investment outlook session of the year, where we will give you our views on the challenges and opportunities for the year ahead. In this event, Mr. Davey will discuss how:

• Recession risks are rising in the West, while Eastern economies recover and re-open
• New secular forces and policy choices herald a different economic regime
• Geographic diversification and active management become essential in parallel worlds

Speaker bio:

Alexander Davey is Global Capability Head of Active Equity and a senior member of the HSBC investment team; he is based in Singapore. He has been working in the industry since 1997, during this time he has covered asian & global equity as well as discretionary macro strategies working in investment  & senior sales roles at Morgan Stanley Investment Management and Barclays Global Investors. Prior to joining HSBC in 2014, he worked as a Private Banker at Barclays. He holds a history degree from the University of York and is a member of the Chartered Securities Institute.