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MULTI ASSET LONG–TERM RETURN EXPECTATIONS
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All investment strategies have the potential for profit and loss, your or your clients’ capital may be at risk.
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Long-Term Return Expectations sets out the Multi Asset Team’s views, as at 30 June 2019, on the prospective returns for asset classes over the next 10 years, and beyond.
Over the first half of 2019, many of the market moves were large enough to have a meaningful impact on our projected 10-year outcomes. Most asset markets saw very strong performance albeit from cheaper starting valuations following the sharp declines seen in late 2018. Whilst we expect growth over the next 10 years to be lower than previous decades, we believe many of the market concerns in recent months are the impact of transient rather than enduring factors. In the first half of 2019 there were tentative signs of stabilisation in economic data after a period of weakness and, perhaps most significantly, there has been a shift in the stance of central banks towards more stimulative policy. We believe current market pricing reflects too pessimistic a view of the likely path of the global economy over the next 10 years and our central economic case continues to be one of moderate global growth. The full report is accessible below, along with a short webcast in which James Squires explains why our Long-Term Return Expectations exercise is fundamental to our investment process. -
CLICK HERE FOR THE FULL H2 2019 LONG-TERM RETURN EXPECTATIONS PAPER.
THE FOLLOWING ARE THE KEY HIGHLIGHTS FROM OUR MOST RECENT LONG-TERM RETURN EXPECTATIONS EXERCISE.
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OUR LONG–TERM RETURN EXPECTATIONS
Expected returns for cash*: 2.00% over next 10 years, 2.75% over the long term
*UK Bank of England.
Note: Baillie Gifford estimates for asset class returns as at 30 June 2019. Expected returns are passive and do not take account of potential alpha. We view these return estimates as broadly sensible indications of likely returns. They should not be interpreted as high precision forecasts nor are they likely to bear much resemblance to returns over shorter time horizons.
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Risk Factors and Important Information
RISK FACTORS
The views expressed in this article are those of Baillie Gifford’s Multi Asset Team and should not be considered as advice or a recommendation to buy, sell or hold a particular investment. They reflect personal opinion and should not be taken as statements of fact nor should any reliance be placed on them when making investment decisions. This communication was produced and approved in November 2019 and has not been updated subsequently. It represents views held at the time of writing and may not reflect current thinking.
Potential for Profit and Loss
All investment strategies have the potential for profit and loss, your or your clients’ capital may be at risk. Past performance is not a guide to future returns.
Stock Examples
Any stock examples and images used in this article are not intended to represent recommendations to buy or sell, neither is it implied that they will prove profitable in the future. It is not known whether they will feature in any future portfolio produced by us. Any individual examples will represent only a small part of the overall portfolio and are inserted purely to help illustrate our investment style.
This article contains information on investments which does not constitute independent research. Accordingly, it is not subject to the protections afforded to independent research and Baillie Gifford and its staff may have dealt in the investments concerned. All information is sourced from Baillie Gifford & Co and is current unless otherwise stated. The images used in this article are for illustrative purposes only.
IMPORTANT INFORMATION
Baillie Gifford & Co and Baillie Gifford & Co Limited are authorised and regulated by the Financial Conduct Authority (FCA). Baillie Gifford & Co Limited is an Authorised Corporate Director of OEICs. Baillie Gifford Overseas Limited provides investment management and advisory services to non-UK Professional/ Institutional clients only. Baillie Gifford Overseas Limited is wholly owned by Baillie Gifford & Co. Baillie Gifford & Co and Baillie Gifford Overseas Limited are authorised and regulated by the FCA in the UK. Baillie Gifford Investment Management (Europe) Limited provides investment management and advisory services to European (excluding UK) clients. It was incorporated in Ireland in May 2018 and is authorised by the Central Bank of Ireland. Through its MiFID passport, it has established Baillie Gifford Investment Management (Europe) Limited (Frankfurt Branch) to market its investment management and advisory services and distribute Baillie Gifford Worldwide Funds plc in Germany. Baillie Gifford Investment Management (Europe) Limited is a wholly owned subsidiary of Baillie Gifford Overseas Limited, which is wholly owned by Baillie Gifford & Co.
Persons resident or domiciled out with the UK should consult with their professional advisers as to whether they require any governmental or other consents in order to enable them to invest, and with their tax advisers for advice relevant to their own particular circumstances.
Important Information Hong Kong
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Important Information South Korea
Baillie Gifford Overseas Limited is licensed with the Financial Services Commission in South Korea as a cross border Discretionary Investment Manager and Non-discretionary Investment Adviser.
Important Information Japan
Mitsubishi UFJ Baillie Gifford Asset Management Limited (‘MUBGAM’) is a joint venture company between Mitsubishi UFJ Trust & Banking Corporation and Baillie Gifford Overseas Limited. MUBGAM is authorised and regulated by the Financial Conduct Authority.
Important Information Australia
This material is provided on the basis that you are a wholesale client as defined within s761G of the Corporations Act 2001 (Cth). Baillie Gifford Overseas Limited (ARBN 118 567 178) is registered as a foreign company under the Corporations Act 2001 (Cth). It is exempt from the requirement to hold an Australian Financial Services License under the Corporations Act 2001 (Cth) in respect of these financial services provided to Australian wholesale clients. Baillie Gifford Overseas Limited is authorised and regulated by the Financial Conduct Authority under UK laws which differ from those applicable in Australia.
Important Information South Africa
Baillie Gifford Overseas Limited is registered as a Foreign Financial Services Provider with the Financial Sector Conduct Authority in South Africa.
Important Information North America
Baillie Gifford International LLC is wholly owned by Baillie Gifford Overseas Limited; it was formed in Delaware in 2005. It is the legal entity through which Baillie Gifford Overseas Limited provides client service and marketing functions in America as well as some marketing functions in Canada. Baillie Gifford Overseas Limited is registered as an Investment Adviser with the Securities & Exchange Commission in the United States of America.
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