Improving your investment decisions
How do you determine the quality of your investment decisions?
If you made a ton of money after buying a bond or stock, you probably rejoiced in having the financial acumen of Warren Buffet. If you didn't, well, you probably thought that your decision was awful.
There is a term for that: resulting. It's when people look at the outcome to determine whether or not the decision was good or bad. Annie Duke, a decision-making consultant and former professional poker player, talks about it in her book "How to Decide". Every decision, she says, has possible outcomes that may be influenced by two things: the quality of the decision process and luck.
In this issue, we talk about recommendations and forecasts from our subject matter experts who apply decision-making and forecasting tools that help eliminate "resulting" and other biases when making investment decisions.
Know where to invest in "Lock in high yields and gradually add stocks to your portfolio", why geopolitics cannot be ignored in "Globalization of politics: What it means for investors", and what our revised forecasts are in "May 2024 Updates: Higher forecast for USD/PHP by end-2024".
You're in good hands.
Metrobank Wealth Insights Team
Lock in high yields and gradually add stocks to your portfolio
Say you are a moderately aggressive investor. Where should you put your money?
With the current market outlook, it is recommended to invest about 70% of your wealth in fixed income instruments or bonds and 30% in equities or stocks.
As inflation is taking more time to go down, opportunity lies in fixed income investments in a higher-for-longer investment climate. It is best to invest in bonds with a longer duration and lock in higher interest rates before they finally go down around the latter part of the year.
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Globalization of politics: What it means for investors
Can Donald Trump influence the performance of your portfolio? Can Vladimir Putin or Xi Jinping dictate your asset allocation strategy? Can Benjamin Netanyahu alter your net worth this year?
Apparently, they can.
“Geopolitical events can have a significant impact on financial markets,” said Ma. Cristina Gabaldon, Head, Investment Management Division, Metrobank.
May 2024 Updates: Higher forecast for USD/PHP for end-2024
Given the recent dollar strength and the peso depreciation, in line with other currencies in the region as most Fed officials signaled a delay in US Fed rate cuts amid the lack of progress on US inflation, we expect the USD/PHP exchange rate to end higher at 56.1 by end-2024 from the previous estimate of PHP 54.0 per dollar with an upward bias.
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