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Pursuing Sustainable Income with a Multi-Asset Approach
Friday 06 September 2024
Investment Talks
Pursuing Sustainable Income with a Multi-Asset Approach
September 2024 | While today’s capital market valuations reflect the general optimism that a recession can be avoided, we believe activity levels may continue to deteriorate during the months ahead. The rise in the cost of money during the past two years has proven moderately effective at crowding out spending by both consumers and corporations alike. We suggest investors keep this prospective outcome in mind as they evaluate potential investment strategies. By placing focus on a solution with less sensitivity to index composition, managers and investors are able to emphasize areas of markets with greater opportunity, while avoiding others where the risk and reward balance is unfavorable.
01 | We believe a global, multi-asset approach with the flexibility to deploy capital across all geographies and asset classes can better equip investors to generate “sustainable” income while helping to balance the risks of today’s markets.
02 | The adoption of a more granular approach toward asset class definition offers the potential to identify attractive opportunities many investors are unable to recognize, or unable to capture.
03 | We favor assets we believe possess deep valuation support and strong free cash flow generation.
Important Information
Unless otherwise stated, all information contained in this document is from Amundi Asset Management as of September 6, 2024. Diversification does not guarantee a profit or protect against a loss. The views expressed regarding market and economic trends are those of the author and not necessarily Amundi Asset Management and are subject to change at any time based on market and other conditions, and there can be no assurance that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, a security recommendation, or as an indication of trading for any Amundi product or service. This material does not constitute an offer or solicitation to buy or sell any security, fund units or services. Investment involves risks, including market, political, liquidity and currency risks. Past performance is not indicative of future results. Amundi US is the US business of Amundi Asset Management.
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Other news
12/31/2024
Investment Talks
What is in store for tech?
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12/23/2024
Investment Talks
Floating Rate Loans: Attractive Income Potential in an Expensive Market
Corporate debt spreads have tightened to near-record levels as the US economy has continued to expand and the Fed has begun to decrease its short-term interest rate target. We believe the improving credit health of the loan universe, the fact that loan coupons are priced off the front end of the still-inverted curve, and the strong possibility that the Fed will be unable to cut rates quickly due to sticky inflation, support the inclusion of loans in income-oriented portfolios. Additionally, considering the likely continuing stickiness of core services inflation, we believe floating rate assets such as loans are currently an attractive option to add diversification to investors’ fixed income portfolios, which are generally weighted in favor of fixed-rate instruments. In effect, we consider loan allocations to represent hedges against continuing high inflation.
12/04/2024
Investment Talks
Looking Beyond a Top-Heavy Market: Four Areas for the Future
Underneath the surface of today’s concentrated US equities market, sharp earnings recoveries may soon play out and structural and cyclical changes may create new winning and losing stocks. Although the market is mostly ignoring the valuation risks, we have seen signs that this market imbalance may be ready to unwind. Notably, a higher-than-average amount of S&P 500 returns is explained by company-specific factors rather than macro factors, and valuation dispersion is also high. For active managers, the key is not just to identify pockets of value, but paths to future value through revenue and earnings growth.
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