Gilbert predicts that 'we're expecting a moderate increase in the global markets on average'
Dubai, 18th February 2016,
Members of Capital Club, Dubai's Premier Private City Club and member of the ENSHAA group of companies, and their guests were recently treated to a highly informative and enthusiastic talk by top financial expert Nili Gilbert. The talk, which was entitled 'Strategies for Navigating the Global Markets in 2016 and Beyond', was hosted by internationally acclaimed journalist Riz Khan and covered development in the global financial landscape and predictions for growth and change in 2016.
Nili Gilbert began the evening with a short overview of her education and career to date. She attended Harvard, where she designed a personalised field of study which blended the softer non-linear idea of culture with the more formal study of economics. Following Harvard, Gilbert completed her MBA at Columbia Business School.
Next, Gilbert joined the large international firm Invesco under Stuart Kaye, with whom she later set up the boutique asset management firm Matarin Capital, where they are now both Portfolio Managers. Gilbert explained that Matarin's investment philosophy is driven by the understanding that asset prices are moved in the intermediate term by dislocations in the market which are often determined by human emotions such as fear, greed and ego.
Gilbert then moved onto the core topic of the evening, discussing the current state of global financial opinions. Currently, everyone is thinking about risk - of which there are a number of sources - and how to manage it. In addition, people are considering the state of the Chinese economy, its impact on international trade, and whether there is a possibility of worldwide recession.
On the volatility of those risks and how she handles them, Gilbert said: "The way we think about it is really hedging, which means building a diverse portfolio so that on any given day if one of your investments is moving in one direction, the hope is that another is moving in the other direction."
An example of how a diverse portfolio can be built, which is popular with institutional investors in the US, is the core satellite approach. This structure of investment is comprised of a core, which acts as a stabiliser, with the satellites surrounding it offering riskier 'moon shot' opportunities. The core satellite approach helps balance the emotional responses that go hand in hand with investments and culminates in a portfolio that's stable and diversified.
Markets are notoriously unpredictable, so to combat that, Gilbert believes in identifying fundamentally good businesses that offer reasonable growth year after year. She is less inclined to invest in unpredictable high growth start-ups and tech bubble companies, which often see investors get so emotionally excited that they push the price up too high - such as the speculative 3D printing and biotech companies of 2012 and 2013. Success, she believes, is about identifying opportunities to buy good businesses at good prices.
Gilbert covered foreign exchange saying that the dollar has started to strengthen due to central bank activity, but that long-term currency forecasting requires a much deeper look at the underlying macroeconomic fundamentals.
Looking ahead to 2016, Gilbert said: "We're expecting a moderate increase in the global markets on average. Given all of the volatility and global concerns that we see right now, we expect that the Federal Reserve is not going to be able to complete all of the additional rate increases that it expects, which will favourably surprise the markets and create a stimulus."
Regarding economic growth in 2016, Gilbert said: "We've actually seen stock markets rise phenomenally since the financial crisis with limited economic growth. This year, we expect to see some more appreciation of the market from central bank stimulus. However, there's still fear in the market, which is juxtaposed by investors who are hungry for a return. It is that combination of fear and greed that creates a lot of short term volatility. From my perspective, I think that the volatility can create a lot of opportunity, as long as you can stay hedged against the risks you can't control."
About Capital Club Dubai: www.capitalclubdubai.com
Capital Club is Dubai's premier private City Club situated in the heart of the financial district - DIFC. A Members-only Club in a contemporary setting for Members to network professionally and socially; dine and party; host private meetings; and attend a wealth of social and business events. The Club is connected to over 250 premier private clubs around the world as part of its reciprocal club network. Capital Club Dubai is majority owned by Signature Clubs International, a member of the ENSHAA group of companies. As the developer and operator of the Capital Club brand, SCI has over 30 years' experience in developing, launching and operating high-end private clubs in the Middle East, Europe and Asia. Its portfolio includes existing Clubs in Dubai, Bahrain and Nairobi, with upcoming initiatives planned in MENASA, Europe and the US, as part of a major five-year global roll out program.
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© Press Release 2016