CC-BY-SA-2.0, FlickrFoto: RonKikuchi, Flickr, Creative Commons. Lombard Odier expande sus capacidades de distribución a través de un acuerdo con Novia
Lombard Odier Investment Management continues to develop its distribution capabilities by making some of its mutual funds available through the Novia Financial and Novia Global Platforms for the first time.
The 17 Lombard Odier IM funds available through Novia Global include some of the group’s most well-known strategies, such as the Convertible Bond fund and Golden Age fund, which invests in equities globally that are expected to benefit as populations grow older.
The inclusion of the 17 funds, many of which are already available on Hargreaves Lansdown’s and Cofunds investment platforms, further builds the group’s distribution footprint.
Novia Global is a multi-currency wealth management service which was launched to the market in October 2015. The platform is available to advisers dealing in the international market, private banks, trust companies and their clients as well as certain other professional investors. Supporting residents (individuals and trusts) based in the Channel Islands, Isle of Man, Switzerland and Europe, Novia Global recently announced the extension of jurisdictions.
“We want to make our diverse range of differentiated funds more readily available to advisers and their clients, and our latest partnership with Novia Group is a reflection of this aim,” said Dominick Peasley, head of Third Party Distribution at Lombard Odier IM.
“We are thrilled to be continually adding to the burgeoning selection of assets on the Global platform and we now offer over 1500 funds on the platform from 67 fund managers and we recently announced the launch of a new DFM service,” said Dave Field, head of Customer Service at Novia Global.
CC-BY-SA-2.0, FlickrFoto: Dafne Cholet. Qué esperar del último trimestre del año en los mercados
The summer, while investors turned their attention to the Democratic National Convention in Philadelphia, the Republican National Convention in Cleveland, the Olympics in Brazil trading has been light.
But what can be expected for the rest of the year? According to Edward J. Perkin, Chief Equity Investment Officer at Eaton Vance Management, “the second half of the year is chock full of likely market catalysts, including potential Brexit fallout, the upcoming presidential election, Fed meetings and more. Against this uncertain backdrop, we continue to believe that equity investors should remain focused and opportunistic.”
For the specialist these are the dates to keep in mind:
September
September is likely to be a busy month. Post-Labor Day is when many voters will begin to pay close attention to the presidential election. Having skipped August, the Fed will meet again on September 21 to make a decision on rates.
There are also a large number of industry conferences, where company management teams will give updates on their businesses. One of these, the “Back to School” conference, held each year in Boston, involves the largest consumer companies.
September is also important in that it is the third month of the quarter. Many companies have “blackout” periods in the final weeks of each quarter and into the early part of the next quarter, when they report earnings. During these blackout periods, companies suspend their share buyback programs in order to avoid accusations of trading on material, nonpublic information. Given how important corporate buybacks have become to the market, this temporary removal of demand for equities has coincided with several of the market’s pullbacks in the past two years.
October
Like July, October is a busy month for corporate earnings releases. With three quarters of the year complete, companies and investors will begin to think about 2017 and the trajectory of earnings into the approaching year. We will likely have a presidential debate in October, perhaps the only debate of this cycle. Television ratings may well set records.
November 8 – Election Day
At the November 2 Fed meeting, Janet Yellen and her colleagues are likely to take no action in order to avoid roiling markets six days prior to Election Day. We expect the market to be focused on the election throughout the summer and into autumn. If the likely result appears clear, Election Day may not produce much of a market reaction. Regardless of who wins the presidency, the equity market may prefer to see the same party capture the House of Representatives and the Senate. The reasoning would be that a new president will be more effective if he/she has the support of Congress.
Under either party, increased fiscal stimulus in 2017 seems likely. This could include corporate tax reform (lowering rates, reducing deductions and encouraging companies to repatriate overseas cash) and an infrastructure spending bill. If modest regulatory relief is also part of the agenda, then the economic outlook for 2017 may be stronger than many currently believe.
November 30 – OPEC meeting in Vienna
OPEC typically meets twice a year, with its next meeting to be held six days after Thanksgiving. At its November 2014 meeting, OPEC surprised global oil markets by maintaining an elevated level of production, which exacerbated the already-falling price of crude. “We expect supply and demand to continue to rebalance between now and the end of 2016. A production cut at the November meeting would be supportive of oil prices, but is unlikely, in our view.” He notes.
December 14 – Final Fed meeting of 2016
In December 2015, the Fed raised the federal funds rate by 0.25%, which led, in part, to market volatility in early 2016. The expectation at the beginning of 2016 was that the Fed had embarked on a path to normalize the level of interest rates. In the first half of the year, however, the Fed failed to follow through with further rate increases. The market has begun to doubt the Fed’s will: At around midyear, the implied probability of a rate increase on or before the December 14 meeting stood at less than 11%.
December is also the month when many investors choose to conduct tax loss harvesting, selling losers in their portfolios to take advantage of the tax benefit that comes from booking the loss before the end of the year. This activity sometimes puts further pressure on stocks that have performed poorly earlier in the year.
Stay focused and opportunistic
The second half of 2016 is full of potential catalysts – including not only the specter of further Brexit turmoil, but also Fed meetings, a presidential election, corporate earnings and incoming economic data. There will likely be a few surprises along the way. “In our equity portfolios at Eaton Vance, we are staying focused on the long-term prospects of our holdings and will look to take advantage of any opportunities thrown our way by the uncertainty of these events.” He concludes.
CC-BY-SA-2.0, FlickrFoto: AdamSelwood, Flickr, Creative Commons. La inversión en ETFs de smart beta crecerá un 25% en los próximos tres años
The amount of assets invested in smart-beta ETFs, which are not based on traditional, market capitalization-weighted indexes, could grow by 25% over the next three years, according to new research from Ignites Distribution Research, a Financial Times service.
“Smart beta” (also known as strategic beta, factor-based indexing and other names) has become one of the hottest concepts in asset management, and especially in ETFs. As of mid-2016, the U.S. market featured over $460 billion in assets invested in more than 600 smart-beta ETFs, according to Morningstar.
Of the 740 financial advisors surveyed by Ignites Distribution Research across broker-dealer and registered investment advisor (RIA) channels, 35% are currently using smart-beta ETFs. “That’s significant, but it’s a notably lower percentage than those using traditional ETFs — which suggests plenty of room to grow”, says the report.
“Our growth expectation is based on the fact that once advisors start using smart-beta ETFs they’re very likely to boost allocations to them. Among the smart-beta ETF users we surveyed, 78% of them plan to increase their overall AUM in smart-beta strategies over the next three years. Of the 78% planning an increase, 14% of advisors are considering increasing their overall AUM in smart-beta ETFs by 11% or more. Extrapolating those dollars to the broader advisor universe suggests more than $100 billion in net new flows to smart-beta ETFs over the next three years even if no new advisors start using them”.
However, more advisors are expected to start using smart-beta ETFs. Of the advisors Ignites surveyed who don’t use smart-beta ETFs, 17.5% are considering using them. Meanwhile, 52% of advisors don’t have plans to use smart-beta ETFs but are open to learning more.
Those findings are contained in Ignites Distribution Research’s new report, The Opportunity in Smart-Beta ETFs, which examines not just the potential for smart-beta ETFs but how advisors are using them and how asset managers can best address this burgeoning market.
“The payoff can be big for purveyors of active management because smart-beta ETFs can command significantly higher fees than traditional ETFs. Already a number of fund firms that typically eschew passive products have drawn on their active expertise to enter the smart-beta ETF market,” says Loren Fox, the director of Ignites Distribution Research and a co-author of the report. “As additional firms add to an increasing number of smart-beta ETFs, it becomes more important to understand how advisors are deploying these products and where there are genuine openings in the market.”
One of the key findings of the report is that financial advisors using smart-beta ETFs view the concept — taking a rules-based approach to gain exposure to a single factor, multiple factors, or even a strategy — as somewhere between active and passive management. The report reveals how often advisors use smart-beta ETFs to complement active or passive allocations in portfolios, or to replace active or passive allocations. Ignites Distribution Research found that asset managers aren’t always attuned to advisors’ use of smart-beta ETFs within portfolios, overemphasizing certain aspects of the products.
Ignites Distribution Research surveyed the Financial Times 400 Top Broker-Dealer Advisors, a list of top broker-dealer advisors from across the U.S. managing, on average, $1.7 billion in client assets; the Financial Times 300 Top Registered Investment Advisors, a list of elite, independent RIA firms managing, on average, $2.8 billion in client assets; and midsize financial advisors in the broker-dealer and RIA channels that manage, on average, $300 million in client assets.
CC-BY-SA-2.0, FlickrFoto: AedoPulltrone, Flickr, Creative Commons. Schroders lanza un nuevo fondo en su plataforma GAIA de la mano de Two Sigma Advisers
Schroders is pleased to announce the launch of an externally-managed fund, Schroder GAIA Two Sigma Diversified, on its UCITS platform. The fund will be sub-advised by Two Sigma Advisers, LP, and launches on 24 August 2016.
The strategy, created by Two Sigma Advisers, LP, in collaboration with Schroders, will combine US equity market-neutral and global macro strategies. The fund aims to offer investors portfolio diversification through a liquid alternative strategy that intends to be uncorrelated to traditional equity and bond markets. The strategy will apply a scientific and algorithmic approach to investing across thousands of individual equities and hundreds of macro markets, allocating the majority of the fund to the equity market-neutral strategy.
Two Sigma Advisers, LP was launched in 2009 and together with its affiliates (“Two Sigma”) has built an innovative platform that combines extraordinary computing power, vast amounts of information, and advanced data science to produce breakthroughs in investment management and related fields. Two Sigma employs more than 1000 people, including more than 150 PhDs.
Geoff Duncombe, Chief Investment Officer of Two Sigma Advisers, LP said: “Two Sigma’s platform approach leverages data and technology expertise to create solutions that meet the needs of diverse investor groups. We are thrilled to partner with Schroders, which has built a preeminent UCITS platform, to bring investors portfolio diversifiers that seek to deliver controlled volatility, low correlation to markets, and attractive risk-adjusted returns.”
Eric Bertrand, Head of Schroders GAIA, said: “We continue to see very strong demand for liquid alternative investment strategies, as clients seek to diversify their portfolios. We’re delighted to partner with Two Sigma to launch this newly created strategy specifically tailored to meet these needs, with the aim of delivering alpha. Two Sigma has a strong reputation in the field due to its leading technology expertise and creative, research-driven approach, which allows the firm to design and evolve intelligent systematic strategies.”
GAIA Platforms
Schroder GAIA and Schroder GAIA II combine the strength of Schroders’ renowned asset management expertise and extensive distribution capability with leading hedge fund managers.
Schroder GAIA Two Sigma Diversified will launch on the Schroder GAIA UCITS platform. Schroders now has nine funds on the two GAIA platforms, eight managed by external hedge fund managers (Schroders GAIA Two Sigma Diversified, Schroder GAIA Egerton Equity, Schroder GAIA Sirios US Equity, Schroder GAIA Paulson Merger Arbitrage, Schroder GAIA BSP Credit, Schroder GAIA BlueTrend, Schroder GAIA Indus PacifiChoice and Schroder GAIA II NGA Turnaround) and one managed internally (Schroder GAIA Cat Bond).
CC-BY-SA-2.0, FlickrPhoto: Ken Teegardin. A Secure Retirement is Not Only a Fundamental Need for Mexicans, but Also Their Own Responsibility
Mexicans today seem to be aware of the challenge they face for their future: 89% of them agrees that their own retirement funding is increasingly their own responsibility, according to the conclusions of Natixis Global Asset Management’s Global Retirement Index 2016, with Mexico ranking 35th in a list of 43 countries.
As the responsibility to finance retirement transfers from governments and employers to people, the need to increase contributions to savings becomes imperative. We believe voluntary contribution via the Afore account can be one of the best alternatives. By defining a savings plan for retirement, financial advisors may provide an added value to workers, with clear ideas and information on how to be better prepared for retirement.
“The pension system coverage in Mexico is still a challenge, and achieving security in retirement may still be difficult, although a possible goal if all the stakeholders — policymakers, employers and workers – contribute”, said Mauricio Giordano, Country Manager, Natixis Global Asset Management México, at the 1st National Afore Convention. According to Giordano, the following 5 principles are a good starting point for a successful retirement plan:
Define the spending needs in retirement: both advisors and workers should honestly assess their spending needs at the time of retiring, keeping in mind priorities such as mortgage or rent, healthcare, family, insurance and taxes. The lifestyle preferences such as travels, clubs and hobbies should also be considered.
Match your retirement funds with your expenses: The key challenges to plan for retirement is how to finance expenses short and long term. Dividing financial commitments in mandatory and optional may help simplify the process to prioritize the spending patterns. The main goal for financial advisors and clients is to continuously and sustainably match funds with spending needs. Resources may include income from investment, social security, pensions and other sources.
Plan for new risks in retirement: The fear to lose money is one of the biggest challenges for workers who save for their pension. This may make investment decisions difficult. Besides considering the traditional risks, retirement plans must consider additional risks such as longevity and inflation.
Minimize fiscal impact: in case an investment portfolio is a main source of cash flow, it is essential to have an effective fiscal strategy. Financial advisors and their clients may resort to a tax professional to ensure an optimum fiscal efficiency.
Commitment and Flexibility: Both for advisors and clients, establishing a plan to fund retirement and financial goals in retirement is a continuous process. It requires flexibility to adapt to changes in the interests and unexpected events such as healthcare issues or long term security. The most effective plans to finance retirement have the capacity to adjust to lifestyle changes.
“Our research shows clear findings: in those countries providing more security to their retirees, the government, employers and specialized investment firms offer incentives and innovative solutions so that workers have the tools they need to save for retirement,” concluded Giordano.
You can read the full report in the following link.
Old Mutual Global Investors (OMGI), part of Old Mutual Wealth, has announced that Diego Parrilla joined the business on 8 August, in the newly created role of managing director, commodities.
Based in Singapore, Diego will report into Paul Simpson, investment director at OMGI. He will initially be responsible for promoting and building the GBP 60 million Old Mutual Gold & Silver Fund to the institutional investors in Singapore and other markets in which OMGI operates. He will also be working with OMGI’s management team to identify absolute return strategies across precious metals and commodities that are aligned with the strategic direction of the company, and with client demand and market suitability.
Diego joins the business from Dymon Asia Capital, where he worked from August 2015 having previously held a number of high profile investment and distribution positions during his career, including portfolio manager at BlueCrest Capital Management, from June 2014 to July 2015; managing director and head of commodities, Asia Pacific at Merrill Lynch from 2009 -2011, and managing director and global head of commodity sales at Merrill Lynch from 2005-2009. Prior to this, Diego was an executive director in the commodities division at Goldman Sachs from 2001-2005, and started his career as a precious metals trader at JP Morgan in London in 1998.
He is also a best-selling author having co-written, “The Energy World Is Flat: Opportunities From The End of Peak Oil” in 2015 and “La Madre De Todas Las Batallas in 2014”. He is also a regular contributor to El Mundo and the Financial Times.
“Diego is a highly accomplished and respected investor and commodities economist, and we’re thrilled to welcome him to the team. At OMGI we recognise that precious metals have become an increasingly important asset class as investors look to hedge against the impact of modern monetary policy. We will call upon Diego’s significant experience and knowledge of commodity markets to assess client demand for alternative commodities products in the future,” commented Richard Buxton, CEO, OMGI.
“We are seeing a perfect storm in the gold markets whereby central banks and global markets are testing the limits of monetary policy, credit markets, and fiat currencies, which in my view support a multi-year bull market for precious metals. The Old Mutual Gold & Silver Fund offers a differentiated proposition. I look forward to working with the entire OMGI team to continue to deliver best in class solutions across precious metals and commodities, key components of global macro markets, for our clients.”, added Diego Parrilla.
The Old Mutual Gold & Silver Fund launched in March 2016 and is managed by Ned Naylor-Leyland. It aims to deliver a total return and utilizes a distinctive investment approach, combining indirect exposure to gold and silver bullion with selected precious metals mining equities.
According to the latest BofA Merrill Lynch Fund Manager Survey cash levels dropped sharply, from a 15-year high of 5.8%, to 5.4% in August. At the same time, global growth expectations rebounded, with a net 23% of investors expecting the global economy to improve in the next 12 months.
“Investors are less bearish, but sentiment has yet to shift from ‘fear’ to ‘greed’. As such, we expect stock prices to rise further until bonds throw another tantrum,” said Michael Hartnett, chief investment strategist.
Other findings include:
Central banks’ creation of a low and stable rates environment is a big factor driving fresh optimism and a preference among fund managers for deflation assets over inflation assets; only 13% of respondents expect the BoJ or ECB negative interest rate policy to end within the next 12 months
A record net 48% of investors think global fiscal policy is currently too restrictive
Geopolitics is seen as the largest risk to financial market stability, followed by protectionism – which is cited at the highest level since December 2010
EU disintegration, followed by renewed China devaluation and US inflation are seen by investors as the biggest tail risks
Allocation to US equities is highest since January 2015 at a net 11% overweight
Allocation to Eurozone equities remains low at a net 1% overweight while allocation to UK equities improves to net 21% underweight from net 27% underweight last month
Allocation to EM equities improves to net 13% overweight, its highest level since September 2014
While allocation to Japanese equities improves to a net 1% underweight from a net 7% underweight last month, allocation preference for the next 12 months worsens to -8% from -3% with only the UK behind Japan
Manish Kabra, European equity quantitative strategist, added that “Eurozone equity allocations are broadly unchanged amid concerns of EU disintegration and UK stocks are still the least-preferred. Within Europe, we prefer UK large-caps from both a positioning and macro perspective, as they benefit from weaker GDP, lower yields and less European exposure.”
CC-BY-SA-2.0, FlickrPhoto: Jose Gutierrez. AUM in the Global Investment Funds Market Grew US$1.1 Trillion in July
According to the Global Fund Market Statistics Report, written by Otto Christian Kober, Global Head of Methodology at Thomson Reuters Lipper, assets under management in the global collective investment funds market grew US$1.1 trillion (+3.0%) for July and stood at US$37.1 trillion at the end of the month.
Estimated net inflows accounted for US$107.7 billion, while US$967.3 billion was added because of the positively performing markets. On a year-to-date basis assets increased US$2.1 trillion (+6.1%). Included in the overall year-to-date asset change figure were US$123.9 billion of estimated net inflows. Compared to a year ago, assets increased US$1.1 trillion (+2.9%). Included in the overall one-year asset change figure were US$478.9 billion of estimated net inflows. The average overall return in U.S.-dollar terms was a positive 3.0% at the end of the reporting month, outperforming the 12-month moving average return by 3.0 percentage points and outperforming the 36-month moving average return by 2.9 percentage points.
Most of the net new money for July was attracted by bond funds, accounting for US$77.6 billion, followed by money market funds and commodity funds, with US$47.7 billion and US$3.3 billion of net inflows, respectively. Equity funds, with a negative US$19.4 billion, were at the bottom of the table for July, bettered by “other” funds and real estate funds, with US$4.5 billion of net outflows and US$0.3 billion of net inflows, respectively. The best performing funds for the month were equity funds at 4.6%, followed by “other” funds and mixed-asset funds, with 4.3% and 2.5% returns on average. Commodity funds at negative 1.3% bottom-performed, bettered by real estate funds and money market funds, with a positive 0.2% and a positive 0.3%, respectively.
In a year-to-date perspective most of the net new money was attracted by bond funds, accounting for US$279.3 billion, followed by commodity funds and alternatives funds, with US$26.0 billion and US$9.1 billion of net inflows, respectively. Equity funds were at the bottom of the table with a negative US$110.9 billion, bettered by mixed-asset funds and money market funds, with US$51.4 billion and US$38.2 billion of net outflows. The best performing funds year-to-date were commodity funds at 12.1%, followed by mixed-asset funds and bond funds, both with 7.2% returns on average. Alternatives funds, with a positive 1.3% was the bottom-performing, bettered by money market funds and “other” funds, with a positive 1.9% and a positive 5.1%, respectively.
CC-BY-SA-2.0, FlickrDavid Knutson, Eric Skelton and Chris Eger . Schroders US Strengthens Credit Team with Three Key Hires
Schroders has announced three senior appointments in the US to underpin the strong growth of its US fixed income business.
David Knutson has joined the US Credit team as Head of Credit Research – Americas. He will be based in New York and report into Wes Sparks, Head of US Credit. David will be covering large US banks. David brings almost 25 years of research experience to Schroders; he joins from Legal and General Investment Management America, where he had been a Senior Analyst in Fixed Income Research for ten years. Prior to this, David spent three years as Director of Fixed Income Research at Mason Street Advisors and seven years working in Credit Research and Debt Capital Markets at UBS. David replaces Jack Davis who transitions internally into a Senior Analyst role.
Eric Skelton joined the Global Fixed Income and FX trading team as US Credit trader for US investment grade credit, based in New York. He will report into Gregg Moore, Head of Trading, Americas and will work closely with US Credit Portfolio Managers, Rick Rezek and Ryan Mostafa and the rest of the US Fixed Income trading desk. Eric Skelton joins Schroders from Achievement Asset Management (formerly Peak6 Advisors), where he was a Credit Trader. Prior to joining Achievement Asset Management in 2014, Eric spent three years at Nuveen Investments.
Chris Eger joins the US Credit team in a newly created role as Portfolio Manager, reporting to Wes Sparks. Chris is based in the New York office. He joins Schroders with 14 years of experience in Investment Grade – in both Trading and Portfolio Management capacities. He joins from J.P. Morgan Chase, where he held the role of Executive Director – Credit Trader, Investment Grade Domestic and Yankee Banks. Prior to joining J.P. Morgan in 2007, Chris spent five years at AIG Global Investment Group where he held two Vice President positions, firstly as a Credit Trader and then as a Total Return Portfolio Manager.
Karl Dasher, CEO North America & Co-Head of Fixed Income at Schroders, said: “Investors globally are increasingly attracted to US credit markets in the search for yield and we have been beneficiaries of that trend. To support continued client demand and process evolution, we have made three strategic hires. These additions will further strengthen our in-house research and execution capabilities in the USD credit domain.”
CC-BY-SA-2.0, Flickr. US Engine of Dividend Growth Slows Markedly, While Europe Picks up the Pace
Global dividend growth slowed in the second quarter, according to the latest Henderson Global Dividend Index. Underlying dividend growth, which strips out exchange rate movements and other lesser factors, was 1.2%. This is slower than the 3.1% underlying growth seen in the first quarter, partly reflecting Q2 seasonal patterns that give greater weight to slower growing parts of the world, and partly owing to a more muted performance from the US.
US payouts rose 3.1% on a headline basis to $101.7bn, equivalent to an underlying increase of 4.6%. This was the slowest rate of growth since 2013, reflecting subdued profit growth in the US, partly due to the impact of a strong dollar. The slowdown in the US began late last year but should be considered a normalisation to more sustainable levels of dividend growth after several quarters of double digit increases.
Income investors turn their attention to Europe in the second quarter. Two-thirds of the region’s dividends are paid in Q2, making it comfortably the largest contributor to the global total. European dividends (excluding the UK) rose 1.1% year on year in headline terms*, but on an underlying basis were an encouraging 4.1% higher. European dividends of $140.2bn made up two-fifths of the global second-quarter total. They were 1.1% higher than Q2 2015 on a headline basis. Underlying growth was an impressive 4.1%, once lower special dividends, particularly in France and Denmark, as well as other lesser factors were taken into account.
The Netherlands and France enjoyed the second and third fastest growth rate in the world, while German growth was hit by big cuts from Volkswagen and Deutsche Bank; Austria, Spain and Belgium also lagged behind.
In Japan, headline growth was 28.8%, with payouts totalling $30.8bn. Two thirds of this increase was down to the currency, with positive index changes accounting for the rest. In underlying terms, therefore, dividends were 0.8% lower, as company earnings were depressed by the strong yen, and as economic confidence in Japan weakened.
It was a challenging quarter for emerging markets. Dividends fell over a quarter on a headline basis to $22.9bn, as weaker currencies and index changes took their toll. Adjusting for these factors, payouts fell 18.8% in underlying terms, with a large number of countries, including the big four BRICs, seeing underlying declines.
The second half of the year is likely to be weaker than the first, partly because seasonal patterns means the emphasis shifts slightly towards those parts of the world where dividends are growing more slowly, like emerging markets, Australia, and the UK. Owing to the changes in the latest quarter, the Henderson’s team has reduced their forecast for the full year to $1.16 trillion, down from $1.18 trillion. This is equivalent to a headline expansion of 1.1%, or 1.4% on an underlying basis.
“We can see how more muted profit expansion, partly owing to stronger currencies, has slowed dividend growth in Japan and the US. In emerging markets, payout cuts have been greater than we expected so far this year as well. Europe remains broadly positive, in line with our expectations. The weak spots we have seen have been company-driven, or owing to specific sector trends like the impact of lower commodity prices, rather than related to wider economic difficulties. The slowdown in the US began late last year but should be considered a normalisation to more sustainable levels of dividend growth after several quarters of double digit increases.” Said Alex Crooke, Head of Global Equity Income.
Since the UK’s decision to leave the EU at the end of June, the pound has fallen further on the foreign exchange markets, extending a descent that began in the months running up to the referendum. However, a number of large international UK companies pay their dividends in dollars, so, according to Crooke, the impact will be less severe than the pound’s devaluation might suggest. In addition, the UK only accounts for around only 10% of global dividends so the effect on the global total is likely to be relatively small.
