Investment Strategy: Positive environment for equities

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At its meeting on 11 May, ABN AMRO affirmed the existing asset allocation. Equities continue to be favoured over bonds. The view on real estate is also positive and commodities are avoided. A neutral stance is taken toward hedge funds. Within bond portfolios, ABN AMRO suggests taking profits in Italian government bonds and using the proceeds to invest in European inflation-linked bonds.

Equities remain the engine of portfolio growth
The positive environment for stock investing is continuing. Over the past week, US stock indices reached new highs and European momentum continued. Market volatility remains low. With the French election of 7 May producing a marketfriendly result, stock investors are back to focusing on fundamentals. The ongoing first-quarter earnings season is slightly better than expected. A solid 12.5% growth, on average, is seen among the 60% of companies that have reported globally. ABN AMRO’s preferred regions for stock investing are Europe and emerging markets.

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