2020 will go down in the history books for it’s unprecedented rebound. All of our portfolios at Intercontinental Wealth Advisors demonstrated great resilience, ending the year solidly in positive territory. While the vertiginous fall in the markets in the Spring may have caused many investors to sit on the sidelines, we decided to acquire positions in the global large cap arena in the Spring. Based on the fact that this was an exogenous shock and not home grown a la the 2008 financial crisis, we believed that the impact on many areas of the markets would be relatively short lived.
Most of our clients are cautiously upbeat about 2021 given the concentrated resolve by the health sector to distribute vaccines, as well as massive fiscal and monetary accommodation. These critical factors will remove the handcuffs on demand and should serve as strong catalysts for the equity markets in the coming year.
My colleagues at Intercontinental are using a barbell strategy when it comes to investing in the global financial markets. On one end, the US tech sector’s strength and the inherently adaptive nature of its underlying firms' business models should continue to accelerate and enjoy solid momentum. On the other end, cyclical assets that are largely representative of the European, Japanese, and emerging markets will begin to prevail as consumer activity resumes in the hospitality, industrial, commodity, and financial sectors.
Within the scope of obtaining a scheduled income stream, it is clearly evident that we will no longer be able to rely on a large swathe of the public market as part of the diversification and yield tool kit. Accordingly, our firm has begun a strategic reallocation into middle market lending, core real estate private equity and credit REITs, and core OECD infrastructure.
We will have more updates in the near future, with our full 2020 Market Review and 2021 Outlook coming soon!
International Director at Intercontinental Wealth Advisors
*Markets are constantly changing. Market Update information is a snapshot in time intended for information purposes only. Intercontinental Wealth Advisors, LLC offers various strategies and different strategies may have different market outlooks.