Markets Will Come to Terms With Tapering: Higgins

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July 05 (Bloomberg) -- Alan Higgins, Chief Investment Officer at Coutts & Co., discusses Fed action and his subsequent investing strategy. He speaks on Bloomberg Television’s “On The Move.” (Source: Bloomberg)

They are tapering.

In the u.k., we stopped q.e. over a year ago.

So we believe the market also come to terms at the end of tapering.

This $85 billion.

The tapering of the market.

Come to terms at the end of q.e. and we think we will get the same kind of message from the fed on rates.

Zero rate sfrur for many years to come.

-- structure for many years to come.

It is a siverpb things on come from the fed in our view.

I know you were telling me over the last two months you have been trying to rotate.

Now you taking more risk.

Within equities.

So we have been prorisk in terms of equities and credit.

For sometime.

But within equities, we have had a lot of the defensives.

We have had yield orientated strategies, especially growing dividends.

It is very, very popular.

It has worked well of course.

We have rotated out of that.

What is your play over the next couple of quarters?

Japanese equities.

We were into japanese equities.

We did add to it it is a market was going up.

It is where the value is.

It is where the catalyst is.

It could backfire.

There could be some impact.

So they are going to have to play a careful game of they want rates up a little bit.

They want inflation.

That is consistent with rates up a bit.

They don't want to -- their market.

That's for sure.

It is.

It is where the value is.

In my experience, when you buy value and are patient, then should a catalyst come, and we have a catalyst, you have a good chance of making gains.

Your i deal portfolio.

You're talking about -- a lot of the money in equities.

You still have a 4% -- that is not much.

Out of 100%. 4% emerging market debt.

Are you not worried about what's happening in china?

Just today they said we're not going public p.m.i. figures.

It is too complicated.

We don't know what situation we're facing and the credit crunch seemed to be kept under control in china.

It is a fair point.

You have to be concerned.

It is a very, very murky situation in china.

Hard to understand what is going on.

Emerging market debt and that is absolutely local, and essentially both double whammy of currency weakness.

It is just twrong -- they made good gains in this last year.

Hammered in may/june.

You just have to stick with it.

Yes, ironically, of course, the chinese currency is one of the stronger ones.

That is not where the problem is.

The problem is the weakness to have asian currencys with the -- there was too much hot money in that.

That is clear.

A lot ever that has come out.

A great contrarian indicator.

When you see huge outflows, it is time to buy.

As a bit of contagion, not really again.

Another coupe.

Donte really understand what is going on.

So resilient.

So maybe the indicator, the global economy is more robust than we think.

The material weaknesss is china specific.

No, it is not something we can really factor in to our work.

Alan, did not know that.

You are a qualified tennis coach

This text has been automatically generated. It may not be 100% accurate.


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