As discussed in August's monthly newsletter, July was a stellar month for UK investors and continued an unseasonably strong summer run for developed world equities. Chinese equities and Asian equities continued to lag and it's no wonder that these sectors are once again absent from the BOTB selection.
If you look at the latest heatmap you can see that the divergence of returns across assets and risk levels continues. The cause of the divergence still lies with the escalating trade war between the US and China. European equities had a strong July which was largely the result of a trade war truce between America and Europe. The fact that European equities have a slight value bias, a style that has outperformed growth-oriented stocks recently, also helped. By way of example, Aberdeen European Equity, from last month's BOTB, rose 4.74% in July. The trade war continues to shape stock markets and the BOTB with the overriding theme of favouring more developed equity markets.
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