BCA Weekly Commentary 10/09/20: Regime Change?
SUMMARY. This week saw further focus away from Covid-19 to political risks. Specifically, a shift towards anticipation of a Biden administration and the impacts on the economy which we recently outlined.
INVESTMENT IMPACT. This week made significant shifts in model portfolios towards the possibility of Biden victory which may result in considerably slower economic growth thru higher taxes and regulation partially offset with much higher fiscal spending. This may also pressure the US dollar and in turn end the era of extremely low long-term interest rates despite slower growth. As a result, we dramatically reduced exposure to Brazil and instead shifted assets into areas of the US economy which may benefit from this regime change. We added positions in health care, solar and China for such a possibility. In addition, we added to financial services tied to prospects of higher rates.
Our model portfolio performance has been updated on our website as of 10/05/20.
For more insights see our website and disclosures found there at BCA. As always contact us for further explanation of how these events can affect your finances. To unsubscribe from our newsletters & website please email us with "unsubscribe" in the subject.