Paris based multimanager and fof manager Myria Asset Management keeps a defensive stance in its portfolios given the market turmoil faced since the beginning of 2016.
In its February 2016 market review, the firm assesses a market regime switch is currently occurring in financial markets and that challenges the cohesion of central banks monetary policies.
Financial markets suffer from the abrupt monetary policy switch of the two most powerful economies of the world, China and the US.
“Until 2014, central banks were unified and together provided liquidity to financial markets. But since the end of the Fed’s QE and since China has decided to support its currency to counter its economic slowdown, two blocks have emerged.
“On one side, we find countries claiming liquidity like the US and China and on the other side remain liquidity providers such as Japan and Europe,” the firm said.
Myria AM underlined global equity markets are still down in the dumps and liquidity issues increase ever more.
It also observed the fixed income area acts as if a global recession is to happen even though no signs can prove such an event will soon occur.
Sources of diversification are hard to find as all risky assets are impacted by the market turmoil.
Myria AM, running seven funds of funds, said its average portfolio is exposed at 25% to equities.
It is overweight in European equity funds largely covered by equity futures and in absolute return funds in order to play the spread of sectors and stocks within the major European equity indices.
The multimanager is underweight in US stocks and has no exposure to Japanese nor to emerging markets equities, considering both areas are too dependent of the global economic growth.
Myria Asset Management is the asset management branch of Union Financière de France.
It managed €2.7bn in assets in multimanagement and €700m in funds of funds as at October 2015.