TRENDS TO WATCH IN 2023

As we settle into the new year, predictions about the world of investing are doing the rounds. And who better to share their insights than Nigel Green, the CEO and Founder of global independent financial advisory, asset management and fintech organization deVere Group?

According to Green, there are four overarching investment themes in 2023 that will help careful investors grow their wealth in the aftermath of a “rocky year”. “Global stock markets fell by a staggering 18 percent in 2022 on average. Bond markets – traditionally a safe haven in times of volatility – have declined by 12 percent on average. And as corrections go, the cryptocurrency one has been particularly punishing,” he commented.

“The downward moves of financial markets have wiped tens of trillions of dollars in wealth over the last year. This is why investors and savers are more alert than ever to the major themes that will define the year ahead.”

1. Inflation is Likely to Peak

“As inflation begins a return to target, the cost of living will drop for consumers and central banks will ease their feet off the economic brakes, going easier on interest rate hikes before winding down,” he says.

2. The Reopening of China

“China’s economy – the world’s second largest – is coming out of hibernation after three years of COVID-19 restrictions,” Green observes. “This could be the most visible, most anticipated and most impactful upside boost for global markets we’ve seen in recent times. The rebound is likely to be dramatic.”

3. A Weakening United States Dollar

“We expect the dollar strength to peak in mid-2023,” he says. “A strong dollar has hit both developed and emerging markets globally, fueling inflation and raising the cost of imported goods. It has also added to the need for some central banks around the world to tighten their own financial conditions. This will all ease when the dollar’s supremacy weakens.”

4. The Rotation

“As cost-of-living eases and global growth picks up pace throughout 2023, investors will be seeking to increase their exposure to growth stocks,” Green shares. “These are stocks that grow at a rate higher than the market average typically, such as tech stocks.”

Investment management firm J.P. Morgan Asset Management has joined forces with Trovata, a bank-connected platform that makes it easier for finance and treasury professionals to manage cash. Under the partnership, the pair will help joint customers access higher yields on corporate investing, despite higher interest rates, by tapping into the Morgan Money corporate investing and trading service.

To do this, Trovata will host Morgan Money as the first third-party app on its platform, with customers to first identify their liquidity needs using Trovata, then using Morgan Money to seamlessly invest. It will enable users to transact in real time across their global portfolio, comparing funds across several managers, currencies, settlement options or durations.

On top of that, it will create a more unified experience with investment balances, and transactions from Morgan Money will feed into Trovata in real time, enabling operating and investing activities to be monitored and managed in one place.

“Now more than ever, corporate treasury investors need a fully integrated trading solution for their liquidity needs,” said Paul Przybylski, Head of Product Strategy and Morgan Money at J.P. Morgan Asset Management. “Bringing two of the newest and fastest-growing experiences in corporate finance and treasury together makes for a powerful combination for our customers.”

Investors are increasingly eschewing insurance products in favor of placing their money in individual stocks and electronic fund transfers, new research from the United States has revealed.

The Financial Industry Regulatory Authority’s National Financial Capability study found that real estate investment trusts, penny stocks and other “riskier” bets also proved to be growing in popularity in 2021, while demand for “safer investments” such as insurance products dipped. Whole life insurance shrank from 38 percent in 2018 to 35 percent in 2021. Annuities also declined from 33 percent in 2015 and 2018 to 29 per cent in 2021.

Individual bonds also decreased from 35 percent in 2015 to 22 percent in 2018 and 29 percent in 2021.

“Findings reveal a new generation of younger and less experienced investors that is vastly different from older generations in their investment behaviors and attitudes,” the report stated. “Younger investors are more likely than older investors to be investing for reasons other than long-term gains, such as social responsibility, entertainment or social activity.”

During 2021, the United States notched up the most foreign direct investment, but which other countries made the top 10? See below for the lead contenders.