South Africa: Investors Still Too Complacent About Future Policy Direction (Part 3 of 8)

China: Can Beijing Maintain the Policy Balancing Act Through 2017? (Part 2 of 8)

Q2 Markets & Governance Review (Part 1 of 8)

Global Asset Allocation, Politics & Governance, Ecstrat

John-Paul Smith

Global Asset Allocation, Politics & Governance

Ecstrat

Ecstrat is a consultancy advising on asset allocation between global equity markets, with a focus on the intersection of governments, geopolitics, governance and markets.
 
Over the past few years and more especially since the Great Financial Crisis (GFC), investors have become more focused on short-term market movements and real-time returns and have consequently neglected the analysis of the underlying structural themes that underpin longer term performance.
​
More specifically we believe that the evolution of governance-based relationships between investors, controlling shareholders, labour and the state is one of the primary determinants of both relative and absolute performance between individual equity markets.
 
We will endeavour to provide investors with some of the context surrounding governance-related issues which encompass many different disciplines including history, economics and political science, as well as the financial metrics which are the most obvious manifestation of the structural characteristics of each market.
 
We will pay particular attention to the shifts and potential inflection points for governance in individual markets as these are often the best lead indicators for both economic and market performance.

Cross Asset Strategy

<p>The Korean equity market has performed well in both absolute and relative terms over the past twelve months and since the start of 2017, for four main reasons:</p><ul><li>The unusually strong performance of the Korean won, partly in response to the recent decline in the value of the dollar, but also reflecting concerns that the US would label Korea as a currency manipulator given the size of the bilateral trade imbalance. The rising won has been a significant contributor to the year-to-date gain of around…</li></ul>

The Korean equity market has performed well in both absolute and relative terms over the past twelve months and since the start of 2017, for four main reasons:The unusually strong performance of the Korean won, partly in response to the recent decline in the value of the dollar, but also reflecting concerns that the US would label Korea as a currency manipulator given the size of the bilateral trade imbalance. The rising won has been a significant contributor to the year-to-date gain of around…

Korea: Post-Election Chaebol Reforms Likely to Disappoint Investors