Alex Borer

“The January rally in equity markets proved to be short-lived, as it faded after three trading days on intensified worries about the global economic downturn. All major equity markets are year to date down again. Global government bond yields rose significantly because of rising funding concerns and risk aversion for long-term paper. Our allocation to high yield bonds paid off because spreads came in from extremely high levels. In terms of portfolio changes, we trimmed the bond allocation by 5 per cent for an EUR money market fund. In equities we increased the S&P 500 buywrite fund at the expense of US equities in order to benefit from the very high volatility.”