Meteoric stock markets crash back to reality
After the prolonged period of calmly up-trending stock markets (see chart above) the market correction that occurred over the last 10 days was perhaps overdue and did not come entirely unexpected as regular readers will know. As I wrote in my stock market assessment email on Tuesday, many (us included) had anticipated and warned this might happen, but nobody to my knowledge had been able to predict when exactly it would happen, nor expected the vehemence and cause.
Accelerating pace of UK rate rises?
In our article on the UK last week, we commented that the Bank of England (BoE) faced a difficult balancing act on setting interest rates: raise too fast and they will compress consumer demand; raise too slowly and inflation will compress that demand for them. This week, the bank has jumped off the fence and (seemingly) come down on one side of the issue, nailing their hawkish colours to the mast.
A ‘flash crash’ post-mortem: volatility goes “bananas”
Who knew that mean reversion could feel quite so mean? But after a sustained upward surge in equity markets, falling back to trend was always going to be painful.
Positive ESG Screening – Ethical investing with two return dimensions
Ethical and sustainable investing is a strategy used by socially conscious investors who want to limit the damaging impact the economy can have on our surroundings. Traditionally, ethical investing took the form of strict negative screening in which ‘sin screens’ were applied to an investment universe in order to restrict exposure to certain industries such as alcohol, gambling or tobacco. Negative screening guarantees that an investor will have zero or minimal exposure to certain unethical industries and therefore won’t be funding tobacco companies to produce cigarettes, for example (generally funds have exposure thresholds of between 0% to <20% of revenue earned from said industries).
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