Securities expected to generate high/improving economic
profitability relative to the market should outperform.
Money supply leads economy, but excess money moves asset
markets earlier i.e. Money Moves Markets (Liquidity Theory of Asset Prices)
Revalidate, test conviction continuously; ensure tight capital
discipline (Behavioral Finance Theory)
Stable revenue
High return on invested capital (ROIC) across business cycle
Do not require leverage to generate returns
Strong brand and/or intellectual property
Resilience to change and technological innovation
Opportunities to deploy capital to grow
Organic growth rather than via large acquisitions
Low threat of regulatory risk
Simple and easy to understand business model
Fundamental macroeconomic liquidity analysis provides the framework for
portfolio construction
Interpreting liquidity trends is paramount to country, sector and thematic views
Liquidity analysis dictates risk appetite at regional, sector and total portfolio level
A portfolio of global equities measured against the MSCI World Net Index.
A focused portfolio of global equities measured against the MSCI World Net Index.
A portfolio of non-North American equities measured against the MSCI EAFE Net Index.
A focused portfolio of non-North American equities measured against the MSCI EAFE Net Index.
A focused portfolio of non-US equities including exposure to emerging markets, measured against the MSCI ACWI ex-US Net Index.
A portfolio of equities in Europe (including or excluding the UK) measured against the MSCI Europe Net Index.
September 30, 2022 | NS Partners
Revised numbers confirm that US GDP fell by 0.6% (1.1% annualised) between Q4 2021 and Q2 2022*. Hours worked in the private sector economy, meanwhile, climbed 1.1% (2.2% annualised) over the same period. What explain [...]
September 23, 2022 | NS Partners
Global six-month real narrow money momentum, the key economic leading indicator in the forecasting approach employed here, is estimated to have moved sideways in deep negative territory in August* – see chart 1. All [...]
September 22, 2022 | NS Partners
While global liquidity remains poor, EM countries are dealing with a more manageable inflation problem than in DM. Money numbers also point to a better economic outlook for EM.
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September 21, 2022 | NS Partners
Global six-month consumer price inflation peaked in June and fell further in August, reflecting pass-through of lower oil prices and a small decline in core momentum. Current commodity prices suggest a sizeable furthe [...]
September 7, 2022 | NS Partners
UK monetary trends continue to argue against Bank of England policy tightening. Annual growth of non-financial M4 – comprising money holdings of households and private non-financial firms – was 3.7% in July, [...]
August 24, 2022 | NS Partners
Cyclical equity market sectors have recouped part of their H1 underperformance of defensive sectors but monetary and cycle considerations suggest further weakness ahead. MSCI divides the 11 GICS sectors into cyc [...]
August 17, 2022 | NS Partners
The assessment here a month ago was that Chinese monetary policy easing was gaining traction but that additional stimulus and a further recovery in narrow money momentum were required to adopt a positive view of eco [...]
August 11, 2022 | NS Partners
Michael Mortimore, gestionnaire de portefeuille client de NSP, a expliqué à WealthBriefing comment l’analyse des cycles de liquidité peut contribuer à la discipline dans la sélection des actions et la répa [...]
August 11, 2022 | NS Partners
The yield spread over Treasuries of the ICE BofA US corporate high yield index rose from 310 bp at end-December to a peak of 599 in early July. It has since retraced more than half of this move. Was the early July pea [...]
August 11, 2022 | NS Partners
Michael Mortimore, NSP’s Client Portfolio Manager spoke to WealthBriefing on how analysis of liquidity cycles can help provide discipline in stock selection and asset allocation.
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