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By Juan Nevado, manager of MG Dynamic Allocation and MG Prudent Allocation funds
Investors today face an uncertain environment. We have just experienced an extraordinary phase in financial markets. Investors remain rattled by the shock of 2008 and this has meaningfully skewed perceptions of risk. Coupled with the unprecedented intervention of central bankers in recent years – and the potentially huge disruption that removal of this intervention could cause – this leaves asset pricing still significantly distorted.
In our view, we are currently in an environment of a deeply unstable disequilibrium in which extremely low cash rates in developed markets have distorted pricing across all sorts of assets around the world. Many assets...
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