BOSTON, MA – 11/12/20 – Vitaly Veksler, CEO and Portfolio Manager at Beyond Borders Investment Strategies, LLC (BBIS) published a new version of the firm’s presentation with a section titled, “Outlook and Catalysts for BBIS’ Strategies Potential Outperformance in the Future” on October 23, 2020. Today he wrote the following post on the section on LinkedIn.
“At Beyond Borders Investment Strategies, LLC, we believe that International and Value stocks may outperform the US and Growth stocks in 2021, thus, reversing two recent stock market trends.
Recent Trends – US and Growth Outperformance: During crises, investors tend to invest in stock markets of the US and other safe-haven countries (i.e. Denmark, Switzerland), or countries that do well during a specific crisis. Since January 2018, the world has faced two global crises in a row – the US-China Trade War and COVID-19 pandemic. Not surprisingly, US stock market indices (S&P 500 & MSCI USA) did well during the period. In 2020, Chinese stocks outperformed most other stock markets due to China’s proficient handling of the COVID-19 epidemic, but MSCI China still earned less than both US indices since Jan 1, 2018. Stock markets of Taiwan and Korea, countries that created modern methods of fighting epidemics after SARS hit their region in 2002-2003, did well in 2020. The US, safe-haven countries, China, Taiwan, and Korea have high weights of Technology stocks in their indices. Technology is the largest sector of the Growth universe. As a result, US stocks outperformed the majority of other countries’ markets, and Growth stocks outperformed Value stocks from Jan 1, 2018 to Oct 31, 2020
Potential Catalysts for the Recent Trend Reversal: However, two major events over the last week might serve as catalysts for reversing the US and Growth outperformance. First, the attractiveness of the US as a business and investment destination might have taken a hit as a result of the presidential elections. The US faces higher probabilities of steeper corporate and personal taxes as well as of increased regulation of businesses by the government. As a result of these potential developments, jobs and investments may move to more business-friendly destinations, thus, slowing US economic growth in 2022 and beyond. Second, the recent news about significant progress in the development of COVID vaccines may convince investors to move their capital from stock markets in the countries, which did relatively well during the pandemic and became expensive in the process, to badly-beaten and cheap (Value) stock markets. We also do not think that the stock markets of other market leaders during the pandemic (i.e. China, safe-haven countries) would maintain their leadership in 2021.”
To learn more about our views, Please Read the Outlook section of the attached BBIS Firm Presentation (Slides 21-30).
Please let us know if you have questions about Beyond Borders Investment Strategies, LLC by sending a message to [email protected].
“At Beyond Borders Investment Strategies, LLC, we believe that International and Value stocks may outperform the US and Growth stocks in 2021, thus, reversing two recent stock market trends.
Recent Trends – US and Growth Outperformance: During crises, investors tend to invest in stock markets of the US and other safe-haven countries (i.e. Denmark, Switzerland), or countries that do well during a specific crisis. Since January 2018, the world has faced two global crises in a row – the US-China Trade War and COVID-19 pandemic. Not surprisingly, US stock market indices (S&P 500 & MSCI USA) did well during the period. In 2020, Chinese stocks outperformed most other stock markets due to China’s proficient handling of the COVID-19 epidemic, but MSCI China still earned less than both US indices since Jan 1, 2018. Stock markets of Taiwan and Korea, countries that created modern methods of fighting epidemics after SARS hit their region in 2002-2003, did well in 2020. The US, safe-haven countries, China, Taiwan, and Korea have high weights of Technology stocks in their indices. Technology is the largest sector of the Growth universe. As a result, US stocks outperformed the majority of other countries’ markets, and Growth stocks outperformed Value stocks from Jan 1, 2018 to Oct 31, 2020
Potential Catalysts for the Recent Trend Reversal: However, two major events over the last week might serve as catalysts for reversing the US and Growth outperformance. First, the attractiveness of the US as a business and investment destination might have taken a hit as a result of the presidential elections. The US faces higher probabilities of steeper corporate and personal taxes as well as of increased regulation of businesses by the government. As a result of these potential developments, jobs and investments may move to more business-friendly destinations, thus, slowing US economic growth in 2022 and beyond. Second, the recent news about significant progress in the development of COVID vaccines may convince investors to move their capital from stock markets in the countries, which did relatively well during the pandemic and became expensive in the process, to badly-beaten and cheap (Value) stock markets. We also do not think that the stock markets of other market leaders during the pandemic (i.e. China, safe-haven countries) would maintain their leadership in 2021.”
To learn more about our views, Please Read the Outlook section of the attached BBIS Firm Presentation (Slides 21-30).
Please let us know if you have questions about Beyond Borders Investment Strategies, LLC by sending a message to [email protected].
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