In such instances cash is usually king, however in this market we tend to disagree as some companies still have a silver lining. Banks and real estate companies are your usual losers, while commodities tend to be accelerating with world growth. So where are these needles in a haystack? They are no longer obvious and require a bit of digging around.
Multi-Horizon Performance
We recommend staying away from cyclicals and companies with significant US exposure. Companies exporting to emerging markets could be the real deal. As such we created a multifactor screen, which is a screen that looks into different factors that could affect the performance of an equity. We used several factors but keyed into the ones that had low US exposure, low valuation, and good growth characteristics. These are by no means recommendations. This is a good framework for further more stringent fundamental analysis.
These views are independent of FactSet Europe Ltd and are proprietary to Bobby Rakhit. For comments please contact rakhitreport@yahoo.co.uk.