Current Investment Traffic Lights
July 2024 – Asset Allocation Framework Highlights
Equities Developed Markets
ETFs on globally diversified and US indices recorded the highest inflows in July. ETFs focussing on the UK and Switzerland also attracted new capital, while Japan ETFs saw outflows. Prices on the UK and Swiss equity markets rose in July, while the other industrialised country markets showed only moderate price changes.
Equities Emerging Markets
Capital was withdrawn from ETFs focussing on China in July, while there was little movement in the other categories. The equity indices of the emerging markets changed only slightly in July.
Sovereign Bonds
ETFs on US Treasuries as well as global and emerging market government bonds saw significant inflows in July. Price changes in indices on US and global government bonds were also clearly positive in July.
Corporate Bonds
High inflows were seen in ETFs on euro corporate bond indices in July, both in the category with investment grade ratings and in high-yield bonds. The picture for US corporate bonds was split: Inflows in bonds with investment grade ratings, outflows in high-yield products. The performance of US corporate bonds was clearly positive. The CIO View for euro high-yield bonds changed from neutral to negative.
Commodities
Gold prices developed positively in July, with listed gold products recording significant inflows. In contrast, the prices of the broad basket of commodities declined. Capital was withdrawn from broad commodity ETFs. The CIO view for gold changed from neutral to positive.
The concept of the Asset Allocation Traffic Light
Defining and applying the correct asset allocation – that is, the distribution of the various components in a portfolio – can be crucial for a portfolio's returns. Risk diversification can be indispensable, and therefore more important than, the choice of a single correct investment exposure. Many investors now intuitively understand the importance of asset allocation in terms of establishing a risk-diversified portfolio. In this case, the Asset Allocation Traffic Light could serve as an information guide to assist in making future investment decisions. The Asset Allocation Traffic Light provides information at a glance on developments in the main equity, bond and commodity categories. To this end, three analyses are clearly summarised for a total of 29 categories.
Asset Allocation Traffic Light – Threefold information for investment decisions
- According to the CIO View:
The DWS Chief Investment Office (CIO) outlook for the next 1-3 months - How the markets performed in the previous month:
Performance of a representative index for the respective category in the preceding month (e.g. the MSCI World for global equities in developed countries) - What ETF flows were like in the global equity, bond and commodity markets: inflows and outflows in approx. 1,500 ETFs in the European ETF market in the previous month
Disclaimer
Source: ETF flows: DWS, Bloomberg; Performance: Reuters; CIO View: CIO Office DWS. China equity views are given relative compared to the MSCI Emerging Markets Index. All other equity views are given in relation to the MSCI AC World Index
Without limitation, information contained herein does not constitute an offer, an invitation to offer or a recommendation to enter into any transaction, nor does it constitute investment advice. The CIO View is a document produced for information purposes only and is not intended to be an offer or solicitation, or the basis for any contract to purchase or sell any security, or other instrument, or for Deutsche Bank to enter into or arrange any type of transaction as a consequence of any information contained herein. The information contained herein, inclusive of the CIO View, has been prepared without consideration of the investment needs, objectives or financial circumstances of any investor. Before making an investment decision, investors need to consider whether the investments are appropriate, in light of their particular investment needs, objectives and financial circumstances. When making an investment decision, investors should rely on the final documentation relating to the investment. Further information is available upon investor’s request. The "green" indicator for a category does not mean that DWS recommends an investment in a particular asset class and/or product. The "red" indicator for a category does not mean that DWS advises against an investment in a particular asset class and/or product. Past performance is not a reliable indicator of future results. Forecasts are not a reliable indicator of future results and no guarantee is assumed that forecasts and objectives will actually be fulfilled. Forecasts are based on assumptions, estimates, beliefs and hypothetical models or analyses that may prove to be incorrect. No guarantee can be assumed that investment goals will be achieved or earnings expectations met.
July 2022 – Asset Allocation Framework Highlights
Equities Developed Markets
All developed equity markets performed positively in July, with the highest gains in the US. ETFs focusing on US indices also accounted for the largest inflows. In contrast, ETFs on European equity indices saw outflows predominate in July. The CIO View remains "neutral" for all categories.
Equities Emerging Markets
Fund movements in emerging market equity ETFs were mixed in July. ETFs on Chinese and global indices saw inflows, while ETFs focused on Asia ex-Japan were flat. The Chinese equity market showed negative performance in July, while equity market performance in the other two categories was flat. The CIO View was changed from "positive" to "neutral" for all emerging market categories.
Sovereign Bonds
Inflows into ETFs focused on US, German and global government bond markets were significantly positive in July. Only emerging market government bond ETFs saw significant outflows. A similar picture was seen in performance with significant price gains in German and global government bond markets. The CIO View remains "neutral" for all categories.
Corporate Bonds
European corporate bond ETFs saw significant inflows in July, both in investment grade bonds and high yield bonds. ETFs on US corporate bonds again showed a split picture. ETFs on investment-grade indices showed significant inflows, while ETFs on high-yield indices showed outflows. Performance was clearly positive for all categories. The CIO View rating for the Europe high-yield bond category was changed to "positive".
Commodities
Both gold products and ETFs on a broad commodity basket again showed significant outflows in July. Both indices on the broad commodity market and the gold price showed negative performance. The CIO View for the broad commodity basket remained at "neutral", while that for gold was also changed to "neutral".
Archiv
June 2024 – Asset Allocation Framework Highlights
Equities Developed Markets
In June, ETFs on globally diversified, European and US equity indices recorded high inflows. In contrast, investors withdrew capital from ETFs with other focus areas, such as ETFs on the Swiss and Japanese equity markets or the eurozone. The performance of indices on most industrialised equity markets stagnated in June, with the exception of Japan, the USA and global indices. There were no changes to the CIO outlook.
Equities Emerging Markets
The performance of the indices was split in two in June. While the Asian equity markets ex Japan and broadly diversified indices gained, equity indices focussing on China lost ground. Only ETFs on global emerging market indices recorded significant inflows. There were no changes in the CIO outlook.
Sovereign Bonds
While ETFs on US government bonds and globally diversified indices showed significant inflows in June, investors withdrew funds from ETFs focussing on German government bonds. Performance stagnated in all segments. The CIO outlook for US government bonds changed from positive to neutral.
Corporate Bonds
ETFs on both European and US corporate bonds with investment grade ratings recorded inflows in June. In contrast, ETFs on European high-yield indices recorded outflows, while there was hardly any movement in US high-yield bond ETFs. The CIO outlook changed from negative to neutral for European high-yield corporate bonds and from neutral to positive for corporate bonds with investment grade ratings.
Commodities
Exchange-traded gold products recorded significant inflows in June. Prices stagnated in June for both gold and the broad basket of commodities.
May 2024 – Asset Allocation Framework Highlights
Equities Developed Markets
In May, the highest inflows were into equity ETFs in the US and global industrialised countries categories. Further investment capital flowed into UK, eurozone, European and Japanese equity ETFs. In contrast, there were outflows from products based on German and Swiss equity indices. With the exception of the Japanese equities category, where prices stagnated, all industrialised country indices recorded price gains in May. There was no change in the CIO outlook.
Equities Emerging Markets
Equity ETFs in all emerging market categories recorded inflows in May. The performance of the corresponding indices stagnated. The CIO View also remained unchanged.
Sovereign Bonds
There was hardly any movement in the prices of government bond indices in May. There were inflows into ETFs in the US, emerging markets and global government bond categories, while there was little demand for products based on German government bonds. The CIO View remained unchanged for all categories.
Corporate Bonds
The performance of the indices for corporate bonds stagnated in May. Only in the USD investment grade category were there notable price gains and new capital flowed into the corresponding ETFs. There were also inflows of funds into ETFs on European high-yield corporate bonds, while the movement of funds stagnated in their US counterparts. There were outflows from ETFs on European investment-grade securities. The CIO outlook remains unchanged.
Commodities
The performance of both the broad commodity basket and gold stagnated in May. While there was hardly any demand for gold products, inflows of funds predominated in the commodity basket. There was no change in the CIO outlook.
April 2024 – Asset Allocation Framework Highlights
Equities Developed Markets
In April, there were particularly high inflows into equity ETFs in the categories of global equty, Europe, the eurozone and Japan. Overall, ETFs on all regions attracted new capital. In terms of price performance, most indices declined in April, with the exception of the indices for Germany and the UK. The CIO outlook for remains unchanged.
Equities Emerging Markets
Emerging market equities: Emerging market indices stagnated in April. Inflows were only positive for the emerging markets global category. There were no changes in the CIO View.
Sovereign Bonds
Government bond indices showed price declines in April, with the market barometers for the US and global emerging markets showing the largest declines. There were inflows into ETFs on German and US government bonds in April. The CIO outlook for US government bonds changed to "positive
Corporate Bonds
The performance of corporate bond indices stagnated in April or was negative, as was the case with US investment-grade bonds. Only ETFs on European high-yield corporate bonds recorded inflows. The CIO View for European investment-grade bonds changed from "positive" to "neutral".
Commodities
The broad commodity basket increased in value in April. Investors again withdrew significant capital from gold products in April, while inflows outweighed inflows into products on the commodities basket. The CIO outlook remains unchanged.
As of 30.06.2017
Source: ETF flows: Deutsche Bank Research; Performance: Reuters; CIO View: CIO Office Deutsche Asset Management. Emerging Markets equity views are given relative compared to the MSCI Emerging Markets Index. All other equity views are given in relation to the MSCI AC World Index
Without limitation, information contained herein does not constitute an offer, an invitation to offer or a recommendation to enter into any transaction, nor does it constitute investment advice. The CIO View is a document produced for information purposes only and is not intended to be an offer or solicitation, or the basis for any contract to purchase or sell any security, or other instrument, or for Deutsche Bank to enter into or arrange any type of transaction as a consequence of any information contained herein. The information contained herein, inclusive of the CIO View, has been prepared without consideration of the investment needs, objectives or financial circumstances of any investor. Before making an investment decision, investors need to consider whether the investments are appropriate, in light of their particular investment needs, objectives and financial circumstances. When making an investment decision, investors should rely on the final documentation relating to the investment. Further information is available upon investor’s request. The "green" indicator for a category does not mean that Deutsche AM recommends an investment in a particular asset class and/or product. The "red" indicator for a category does not mean that Deutsche AM advises against an investment in a particular asset class and/or product. Past performance is not a reliable indicator of future results. Forecasts are not a reliable indicator of future results and no guarantee is assumed that forecasts and objectives will actually be fulfilled. Forecasts are based on assumptions, estimates, beliefs and hypothetical models or analyses that may prove to be incorrect. No guarantee can be assumed that investment goals will be achieved or earnings expectations met.