Private Investor's Diary Portfolio 

Three new quality additions

Three new quality additions

January 2019

What a difference a month makes. A strong start to the year for virtually everything; global equities, commodities, US treasuries, gold and sterling. I concluded last month’s column by saying there were reasons to be optimistic but even I, as an inveterate optimist, did not expect such a strong January. Three main factors are probably responsible for the change in sentiment. First, the Federal Reserve has softened its stance on further tightening of US monetary policy. Nothing wrong with that, as John Maynard Keynes said, “if the facts change, I change my mind”. Inflation expectations in the US have fallen substantially in recent months. Second, the resumption of trade talks between the US and China, which is expected to conclude positively, and third, markets were starting from an 'oversold' position given the precipitous falls in the fourth quarter of last year.

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