People are soon going to realise there’s no money to be made in cash or at the bank.
Fund managers hungry to show better returns are going to start buying any dip they see. We’re already seeing evidence of that on the trading desk.
And the moment there’s a clear path forward for less risk in equities, it could be game on!
Here are some of the factors I see that could open up an avalanche of cash into stocks:
- A working vaccine. This ends the risk event. All those stocks that got hammered from March could start jumping. Beyond like anything we’ve seen before.
- Fast-slowing rates of infection. The market is already liking the trend of downward coronavirus curves.
- A ‘friendlier’ China. With signs of internal opposition to President Xi ‘blowing China’s great chance’, we may see a more cooperative approach to trade and other areas.
- Unemployment, record high debt levels, and government interventions start to implode property markets. Investors in these sectors lose faith and look toward capital markets for return.
- Collins and then Trump get elected in October and November. Pleasing the market with lower taxes and infrastructure spending. Trump has already said: ‘We’re…also considering a capital gains tax cut, which would create a lot more jobs…’
So, if there is going to be an avalanche, where do we see some positive places to stand?
Take a look at our latest portfolio update…
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