Model portfolios – Swiss focus: Rising economy puts bonds under pressure

With the economy picking up, it is to be expected that central banks could show more restraint.

Supported by an - in view of the difficult circumstances - surprisingly robust economy, the financial markets have recently shown renewed optimism. Speculative excesses in individual equities are making news. We are maintaining our neutral equity quota and minimising the risk by investing diversified in hundreds of stocks in the portfolios we manage.

In the US, the government is providing additional support with new aid packages. Companies are exceptionally optimistic. With its flexible economy, the US seems well positioned for recovery. Accordingly, we are positioning our portfolios with an increased US focus in equity investments at the expense of European equities.

With the purchase of inflation-linked bonds in spring 2020, we had geared our portfolios to inflation expectations rising. This is exactly what has happened. We are now unwinding this position. With the economy picking up, it is to be expected that central banks will be more cautious and bond prices could therefore come under pressure. We are therefore positioning the portfolios with an underweight in bonds.

Interest income

Liquidity 9%, equities 12%, fixed income 69%, alternative investments 10%
Source: PostFinance

Income

Liquidity 8%, equities 27%, fixed income 55%, alternative investments 10%
Quelle: PostFinance

Balanced

Liquidity 7%, equities 48%, fixed income 35%, alternative investments 10%
Source: PostFinance

Growth

Liquidity 7%, equities 66%, fixed income 17%, alternative investments 10%
Quelle: PostFinance

Capital gains

Liquidity 5%, equities 85%, fixed income 0%, alternative investments 10%
Source: PostFinance
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