Innova’s asset allocation positioning and market outlook for the first quarter of 2023.
2022 concluded with a sigh of relief in risk markets, as investors were met with a cascade of positive narratives to end the year. Global growth was buoyed by the twin reliefs of an easing risk of a short-term European energy crisis, as well as the sudden re opening of the world’s second largest economy in the form of China’s pivot from COVID-zero.
The portfolios remain relatively defensively positioned, albeit we have been active in reintroducing a position into well-valued sectors, in particular a diversified and actively managed Asia exposure. Our key overweight’s have remained consistent this quarter as value equities, defensive alternatives and investment-grade, floating rate credit – tactically, our positioning in Asia, UK equities and soft commodities/agriculture all continue to show reasonable valuation metrics and positive forecast returns in our systematic outputs.