Asset Allocation for January 2017

In December investors focused their view on commodity markets and other risky assets. Cryptocurrencies showed insane volatility.

Oil and iron ore prices jumped to 2-year maximums. On top of everything most of investment banks forecast grain prices growth in 2018. Hereby commodity market could come to bullish cycle and stimulate emerging markets growth.

In December in US investors made bet on industrial and financial stocks that potentially could gain after tax reform been implemented. Tech stocks were the underdogs of the market because of little effect of US corporate tax cut for this sector. That’s why investors withdrew money from Growth companies stocks and put them into traditional economy sectors.

Hard not to mention the dynamic of cryptocurrencies value. Bitcoin price reached almost 20K USD in the early December that caused skyrocketing of altcoins.

Threat and challenges in world markets:
- Monetary policy tightening by US FED
- Growing tensions between USA, South Korea, Japan and North Korea
- Mifid II implementation by European banks

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