Date
22 October 2017
The end of the quarter is usually the time when fund managers are engaged in active switching of bets. Photo: Bloomberg
The end of the quarter is usually the time when fund managers are engaged in active switching of bets. Photo: Bloomberg

Stick to new economy plays as cornerstone of portfolio

The stock market is becoming increasingly divergent, and investors are constantly switching from one sector to another. The end of the quarter is in fact a period when fund managers are active in switching bets.

Although market sentiment has been swinging quite a bit amid a mix of good and bad news in late June, traditional safe-haven indicators like the VIX, bonds, gold and the Japanese yen have not moved wildly, indicating that the underlying tone remains stable.

While switching from tech plays to financials dominated end-of-quarter trading activities, I believe the medium-term trend of focusing on new economy plays won’t change.

Among recent news, Amazon’s acquisition of Whole Foods Market is the most important, as it shows how ambitious technology giants can be, and hence their growth potential.

Elsewhere, Chinese A shares are relatively strong, and investors could consider adding or switching part of their portfolio into this segment.

This article appeared in the Hong Kong Economic Journal on July 4

Translation by Julie Zhu

[Chinese version 中文版]

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RT/CG

Director, Asset Management at Ample Capital Limited.

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