Markets and investing

The arrival of spring means one can spend extra time exercising outdoors (at least when the weather cooperates). While one doesn’t need to run a marathon to get back in shape, we think active portfolio management is more like a long jog than a short sprint – the key is keeping the right pace.

First thing first, when we talk about small-cap equities (or small caps), it’s important to understand what “cap” refers to. Cap is short for capitalisation, which in turn is short for market capitalisation.

The first few months of 2024 have come as somewhat of a surprise to investors. For example, US growth has stayed resilient, continuing to defy the odds of recession, so markets have had to reevaluate their expectations for the year. And we are no different. Investing is about finding the right balance between having conviction in your long-term strategy and being conscious of the opportunities in the short term.

After three decades of globalisation, could reshoring change the global order?

In our 2024 Investment Outlook, released in December 2023, I mentioned the importance of building an investment strategy with multiple time horizons in mind. And, over the past two months, things have changed for the medium-term growth outlook. In January, the 2023 US growth figures came in better than expected, showing a resilience in the US economy that the market didn’t anticipate.

Speaking about foresight and perceptiveness in markets, John Maynard Keynes, likely one the most well-known economists ever, said that successful investing is anticipating the anticipations of others. Keynes was also an investor.