Market Risks for Income Investors

A series of “macro-hurricanes” sweeping through global financial markets have given even the most sophisticated investors cause to stop and think in recent times

Franklin Templeton Investments 2 June, 2015 | 2:52PM

Morningstar's "Perspectives" series features investment insights from selected third-party contributors. Here Toby Hayes, portfolio manager, Franklin Templeton Solutions, explains why he believes in monetising volatility.

Significant moves in macro indicators such as the strength of the US dollar and volatility in the price of commodities—not least oil—have had massive economic implications in recent months, both at the corporate and government level. While some of these macro-trends might be considered positive, their benefits tend to be felt further down the line.

For example, the benefits to the consumer of lower oil prices are probably likely to be seen feeding through to global growth in the second half of this year. On the other hand, we are already seeing evidence of the pain of the effect of the US dollar’s rise on US exporters and those with dollar-denominated liabilities.

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About Author

Franklin Templeton Investments  is one of the world's largest asset management groups, offering UK investors a range of over 80 funds across different market sectors.

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