Feng shui experts predict that 2023 will be a year of hope and prosperity, however, financial experts warned that familiar foes like inflation and geopolitics like the rivalry between the G2 powers of China and the US will continue to haunt investors during the year.
Citibank, in a separate report, had a similar take saying that they see “potential for pursuing portfolio income” with short- and intermediate-term US dollar-denominated bonds. “However, as we move through 2023, the broad-based USD weakness, expected improvement in China’s growth outlook and the correction of the fundamental undervaluation based on Terms of Trade, especially for AUD/USD, are likely to enable commodity currencies to appreciate by 3-5% vs the USD,” Standard Chartered reported.
Those wanting to position themselves more defensively must consider stocks from cheaper sectors such as healthcare. “Extensive fiscal programmes and high levels of savings should buoy private consumption and expected stronger Chinese growth will be important to many European companies,” Holtze-Jen commented.
“We continue to see upside potential for green energy and infrastructure going into 2023, given Europe’s need to diversify its energy mix away from Russian natural gas dependence,” Citibank added.Amongst emerging economies, Holtze-Jen said Asian markets remain the most attractive, particularly countries in the northern markets like South Korea, Taiwan, and China which saw strong declines in valuations in 2022.
In India, Standard Chartered would buy the financial, industrial, and consumer staples sectors, saying these will benefit from domestic demand.Alternative investments are key to investors seeking a yield in excess of the market return. Examples of this are actively managed illiquid investments such as private equity, private debt , venture capital, and infrastructure investments.
“Infrastructure is the backbone to sustainably growing economies. Climate change and the energy crisis require huge public and private investments, in particular new, economy and old economy investments,” she said.Like what the saying “old, but gold” implies, gold remains relevant as ever to investors seeking to diversify their portfolio over the longer term.