Global volatility and uncertainty should be more moderate in 2013 and accompanied by a return to fundamentals, according to Neuberger Berman Group portfolio managers.
The fund manager expects the global macroeconomic concerns that dominated investor actions in 2012 will become softened in 2013, allowing for greater emphasis on security and sector selection across a range of asset classes.
“The perception of vulnerability was always in the background, and it meant that investors kept their eyes on the macro,” Neuberger Berman president and chief investment officer Joseph Amato said.
“Although there are continuing issues, we now have some confidence that we’ll get more stability in 2013, and that should present outperformance opportunities,” he said.
In fixed income, investors will continue to search for yield, potentially beyond traditional areas, Neuberger Berman’s chief investment officer of fixed income Brad Tank said.
“We see various areas for potential diversification for investors that are willing to add incremental risk – in high-yield bonds, bank loans, emerging market debt and residential loans,” he said.
“The whole exercise of finding yield requires a certain amount of creativity, a lot of research and broad expertise to effectively assess these pockets of the market.”
Mr Tank said investors should consider an asset allocation mix of multiple asset classes in order to get the desired returns.
“One of the most important sources of macro-driven markets is the global impact of local policy uncertainties. Investors should be prepared for macro influences, but avoid letting them distort an investment strategy designed to achieve long-term objectives,” Neuberger Berman director of investment strategy Matthew Rubin said.
