In its Q3 Investment Outlook ‘Gauging value’, published this week, ABN AMRO Private Banking upgrades hedge funds to Overweight from Neutral, citing global macro, CTA, relative value and event driven strategies as insurance against economic and policy risks. Long/short equities retain a negative rating.
Despite remaining Overweight on Asian and Latin American emerging-market equities and in the Industrials and Consumer Staples sectors, the bank keeps an overall Neutral position on equities. Underweight allocations are held for commodities and fixed income, with high-quality corporate bonds preferred – particularly in Asia. The bank remains wary of safe-haven government debt, with record low yields vulnerable to interest-rate rises.