Outlook 2024: Targeting opportunities

As interest rates begin to level off, a new investment environment is emerging with opportunities that may not have existed in years. Diversifying portfolios – and making bold, conviction-led decisions – could be essential as performance diverges between companies, asset classes and economies.

Uncertainty remains high, with the potential for an oil-price shock and the implications of November’s US election adding to the mix. But the good news is investors may be rewarded for taking risk again.

Key takeaways
- In a break from consensus, we expect a recession in the US and think markets may be underestimating the extent to which major central banks will have to keep rates higher for longer.
- An active approach to selecting and managing investments will be critical as not all assets will perform in an era where money has a cost again.
- Markets may be volatile as uncertainty surrounds growth, interest rates and geopolitical events – but shifts may provide opportunities to build long-term positions based on strong convictions.
- We think conditions are aligning to make fixed income a compelling proposition and see entry points within equities, with a focus on quality names and themes.
- Diversification will be essential: the market environment and valuations may present opportunities in certain private markets such as private credit and infrastructure.