There will be major changes in the UK and world markets over the next 12 to 60 months, according to forecasts from an expert investment panel at the Morningstar London Investment Conference 2013.
Among the changes forecast were th slowing of the Chinese economy, the revival of the US dollar over the next five years as the world's strongest currency and political turmoil next year in the UK with the coalition predicted to split over the direction of the economy.
The panel debate, in front of more than 250 Financial Planners and advisers, ended the 2013 Morningstar London Investment Conference. It was titled: Asset Allocation: History or Future?
An expert panel unravelled key asset allocation questions including contradicting asset allocations, how will indebted countries deal with their debts - grow, default or inflate? and do economics text books need to be rewritten given recent events?
On the panel was: Chris Rice, head of pan-European Equities at Cazenove; Ewen Cameron Watt, chief investment strategist at BlackRock and Stewart Cowley, head of Fixed Income at Old Mutual Global Investors. The panel was chaired by Peter Toogood, investment services director, Morningstar OBSR.
Mr Cowley said investors should be seeking inflation protection and it was a time to be cautious. Recent rises in markets were welcome, he said, but there could be stormy times ahead.
Mr Cameron Watt forecast that the US dollar would be the world's strongest currency over the next five years. He said the much favoured emerging markets were now looking expensive on some measures and within 12 months there would be political breakdown in the UK as the coalition divided over economic issues. He added that China's economy would inevitably show slowing growth but may still be investible.
Mr Rice said some European equities were beginning to look interesting and there were some "pockets" of equities looking extremely cheap.
During the two day conference, which ended today (Weds 15 May) over 400 people attended including many Financial Planners and financial advisers. The event was supported by the Institute of Financial Planning and held on London's South Bank.