Seneca Global Income & Growth Trust’s (SIGT’s) manager, is gradually reducing the trust’s equity weighting over the next couple of years, in advance of a global recession it expects in 2020. Consistent with its view, the recent trend in developed economies has been one of falling unemployment, labour markets tightening, wage rates edging up and nascent signs that consumer prices are also on the rise. SIGT’s manager expects inflation to continue to rise, triggering further monetary tightening and ultimately recession. SIGT has recently underperformed its benchmark and global equity markets, but its manager expects its multi-asset strategy to strongly outperform these in the downturn.
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Mind the (inflation) gap!
- Published:
18 Sep 2018 -
Author:
Ed Marten -
Pages:
14
Seneca Global Income & Growth Trust’s (SIGT’s) manager, is gradually reducing the trust’s equity weighting over the next couple of years, in advance of a global recession it expects in 2020. Consistent with its view, the recent trend in developed economies has been one of falling unemployment, labour markets tightening, wage rates edging up and nascent signs that consumer prices are also on the rise. SIGT’s manager expects inflation to continue to rise, triggering further monetary tightening and ultimately recession. SIGT has recently underperformed its benchmark and global equity markets, but its manager expects its multi-asset strategy to strongly outperform these in the downturn.