Monthly Asset Analysis: Market Trends and Investment Opportunities

The updated monthly asset allocation table is now available here.

Good news, all trends are back in the green! Be careful though because the valuation levels of some indices are breaking records. I am thinking in particular of the Swiss and American markets which are at historic highs. Technicians will tend to jump on them because we are in a zone free of resistance, while fundamentalists will rather want to flee because of the exuberance of the markets.

What is interesting is that in this generalized bullish phase, we find indices that have become attractive, even very attractive, due to the last correction. European and English stocks, for example, are currently correctly valued as a whole and are following a very pronounced upward movement. In Canada and Australia, we are in a similar configuration, but the valuations are less attractive.

As in recent months, emerging countries are particularly tempting at the moment, with both a strong upward trend and really affordable prices, not to say knockdowns. Significantly, what I have been waiting for for months has just happened, Japan has now joined the emerging countries in this "Select" club of bullish and very cheap indices. I will be relaunching my screeners in the coming days to find, I hope, several nuggets.

In terms of other assets, it is the status quo. Long-term Confederation bonds are still inaccessible due to negative rates. Real estate, my only permanent allocation, has beaten the SMI over the last six months, with a performance of more than 9%. Alternative strategies are still waiting for a fall in the American market and gold is having fun yo-yoing in a fairly restricted trading range, but with a still bullish trend.

The general return to favor of stocks means that the target reserve of liquidity continues to fall, at now 7%. I am still at 35%, but I have no doubt that I will become a spender if I come across beautiful Japanese cars on the road...