Asset Allocation Strategy
Stay Positioned for Global Reflation
Mon 29th March, 2021

Given the significant global economic and profit recovery still ahead of us, we continue to see good prospects for equities over the coming year.

We retain caution toward core fixed interest as we still see upside to bond yields in the US and Australia over the coming year, albeit the pace of the sell-off should slow.

We remain overweight alternatives for 3 reasons:

  1. Our caution toward relying on core fixed interest as a portfolio diversifier
  2. The elevated level of equity valuations, albeit equities do not look expensive relative to the prevailing interest rate structure
  3. The existence of attractive risk-adjusted return potential in the alternatives universe

In our Q2 asset allocation report we explore the global revival including:

  • Whether bonds will end the equity bull market
  • The prospect of steady solid growth from China
  • Australia’s outperformance and scope for further improvement
  • Why the recent strength in the US$ is likely to be temporary
  • The risk of a sharp bond market sell-off and how the Fed would respond
  • The earnings recovery ahead for equities
  • Why the emerging markets pullback is likely to be temporary
  • The opportunities in alternatives

Disclaimer and disclosures

Recommendation structure, definitions and the Financial Services Guide (“FSG”) can be found at


This document has been prepared by Wilsons Advisory and Stockbroking Limited (AFSL 238375, ABN 68 010 529 665) (“Wilsons”) and its authors without consultation with any third parties, nor is Wilsons authorised to provide any information or make any representation or warranty on behalf of such parties. Any opinions contained in this document are subject to change and do not necessarily reflect the views of Wilsons. This document has not been prepared or reviewed by Wilsons' Research Department and does not constitute investment research. Wilsons makes no representation or warranty, express or implied, as to the accuracy or completeness of the information and opinions contained therein, and no reliance should be placed on this document in making any investment decision. Any projections contained in this communication are estimates only. Such projections are subject to market influences and contingent upon matters outside the control of Wilsons and therefore may not be realised in the future. Past performance is not an indication of future performance.

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