Although the coronavirus outbreak has caused major disruptions and geopolitical risk is on the rise, markets are looking forward to recovery. In what appears to be a rapidly changing world, many things remain the same and indeed, may be changing for the better.
The Covid-19 pandemic has accelerated the adoption of internet-based healthcare services. Growing in importance, penetration and acceptance, telemedicine will revolutionise and augment Asia’s healthcare systems.
Yoshihide Suga, Japan’s new prime minister, is widely expected to retain his predecessor’s fiscal and monetary policies known as “Abenomics”.
Clearly, it remains difficult to predict events in this volatile environment, but in the interest of our clients, we do our best and fortunately this time, we had virtually unanimous agreement on a similar scenario as in June, both politically and economically.
It does not seem that there are enough differences between Abenomics and the proposed economic policies of likely new Prime Minister Suga to justify the completely new portmanteau “Suganomics,” as a few analysts have suggested.
Part 3: How does a portfolio manager invest in disruptive innovation?
Part 2: Could a disruptive innovation strategy sit in a client’s portfolio?
Part 1: Why invest in disruptive innovation?
In my experience, there is nothing so powerful for asset markets as an “unquantifiable positive story and a tonne of liquidity”. Russell Napier’s Library of Mistakes in Edinburgh looks brilliantly at some of the madness that has taken hold of financial markets over the centuries (well worth a visit if you are ever nearby), and of course Edward Chancellor’s Devil take the Hindmost is the seminal text on the subject of credit-financed investment madness, but I have seen my fair share of mad booms firsthand.
We have little (in fact, virtually no) doubt that the opening salvos of the monetary response to the Pandemic were driven by a sense of panic rather than by calculated analysis. The Federal Reserve appeared to be downplaying internally as well as externally the impact of the Pandemic as late as on the 11th March 2020, but by lunch time on the 12th March it was in full crisis mode.
As the famous 1980s’ bumper sticker (almost) said, “shocks happen”. The global economy / ecosystem is an inherently dynamic entity, constantly changing its shape and composition. Some of these changes will of course favour some economies while disadvantaging others.
The economic costs of the current conflict in Ukraine may pale into insignificance in comparison to the human suffering, but they are not irrelevant to markets. The bottom line is of course that wars make society poorer, as does conflict in general, natural disasters, or catastrophic errors.
It is well known that issues of fees, complexity and illiquidity are reasons often used to dismiss investment portfolios that include hedge fund strategies.
The short answer is: it depends on the hedge fund you are looking at, and how they’re implemented to a wider KiwiSaver portfolio.
During the late 1980s, at the height of the Bubble Economy, and at a time during which seemingly everyone wanted to emulate the Japanese economic model, we were lucky enough to have high level access to the Bank of Japan.
There has been a marked inflation of money balances in the USA and of course elsewhere within the global economy over the last 18 months that has led to a generalized inflation of household balance sheets – nominal expenditure, financial asset prices, and property prices have each inflated – in many cases proportionately.
It goes without saying that the Covid-19 Pandemic has caused – and is still causing – disruptions to people’s ability to spend and companies’ ability to produce goods and to supply services. Moreover, the Pandemic looks set to disrupt the global economy for at least another six months and most likely somewhat longer.
We need to collect some of your personal information to provide you with the best possible service. The purpose of this policy is to give you peace of mind that we take your privacy very seriously.
We want to be clear as to what information we collect and why, and what we do with it. We also set out what your rights are below.
There are four kinds of situations in which we will collect personal information about you:
The amount and nature of the information that we collect and reasons for it are different in each case.
Whenever you visit a website there’s an exchange of information between your device, your browser and the website you are visiting. When you visit our website (and many other websites) “Cookies” will be stored on your device.
Cookies are small pieces of data stored on your device that help us to remember who you are and show you content that is relevant to your interests. Besides improving your experience, this also helps us to improve our website. Some cookies only last for a short time, while you browse web pages, some are stored longer, so we can recognise you if you return to our website.
We use a combination of the following types of cookies:
Most browsers give you tools to manage cookies to suit your needs. Some browsers allow you to manage cookies on a site-by-site basis, and some allow you to browse in a private mode which ensures cookies are deleted after you close your browser tab or window. If you choose to completely disable cookies while browsing our site, please note that some functionality may not work correctly.
If you want to set up a goal in GoalsGetter we ask you to provide your name, email address and password so that we can set up an account for you.
If you create an account and save a goal, we store all the inputs that go into providing that projection. This is primarily so that you can always come back, but we also use it for assurance to make sure that the digital tool and the algorithms behind it are working as they should.
In addition, once we have received your email address and you’ve gone through the process of saving a goal, our understanding will be that you’ve some interest in our products and consent to a reasonable level of communication from us. Therefore, we will send you information relating to our products or market commentary that we think you may be interested in from time to time. We may also provide information that may assist you with the practicalities of completing an application to invest.
Our aim is to provide you with quality information when it’s useful to you, not to bombard. If you wish to unsubscribe at any point you can in the correspondence that we send.
At this point we collect the required personal information to set up your investment, which may include your ID, tax status and address.
Part of the reason for the collection of information is for the efficient and secure administration of your account, but also part of the reason is to cover off a number of legal/regulatory issues that we are required to do by law such as information for anti-money laundering purposes, *FATCA and *CRS information, and other tax information.
Once you have invested with us, our understanding will be that you are interested in our products and so we’ll use some of the information to provide you with information about other products that you may be interested in and or articles commentary etc.
If you wish to unsubscribe at any point, you can in the correspondence that we send. However, by law there is a minimum amount of regulatory information that we are required to provide you with in relation to your investment.
Generally, we record the content of other communications that you have with us, whether by email or phone etc. This helps us do business with you in the future and also helps us ensure that we are providing our customers with quality services.
Nikko AM NZ is part of a global group of asset management companies with a head office in Japan. Because of our global nature, our business has global quality cyber security to protect your information.
Being part of a global group also means that it’ likely that parts of your information will be stored in cloud-based services or in Nikko AM group infrastructure in other countries for example much of our data is backed up in Japan. However, all the companies, which form part of the Nikko AM group subscribe to a global data protection policy that is equivalent to the European GDPR standard and IT security is overseen by global teams. We also comply with ISO 27001 (a global standard).
As financial services is a complex industry, some of your information will be held by and/or accessible by third party partners of ours or entities that we are required by law to interact with. These include, but are not limited to, professional registry service businesses to administer your holdings, professional custodians who hold your assets, statutory supervisors whose job is to uphold your interests as an investor, marketing agencies which may be international, IT support and data warehousing businesses (which may be based off shore), businesses that provide identity checks, auditors and Government agencies, such as regulators and tax authorities. We may also grant access to your financial adviser if you have instructed us to give access to your financial adviser. In every instance, we shall take steps to ensure that your information is kept safe and secure.
As noted above, one of Nikko AM’s objectives is to provide you with quality information when it is useful to you; whether it’s market commentary or information about our products.
Therefore, aggregated customer information may be provided to third party marketing and analytics organisations to assist us to understand preferences and to help distribute the information to you.
You can always opt out of communications if you choose to.
Sometimes we’ll be required to collect personal information from entities that we do business with. Generally this will be to verify your authority to act or for regulatory purposes, such as anti money laundering legislation.
Generally the circumstances of collection and storage described above will apply to you, except that we will not use information that you disclose on behalf of a business to market to you in your personal capacity.
You have a right to request access to and correct personal information that we hold about you. If you wish to do this, please contact us to discuss how this should be done taking into account your circumstances and complexity of the request.
If you have a query or complaint about your personal information or this policy, please feel free to direct it to the privacy officer below.
Nikko AM NZ Privacy Officer, Level 17, Vero Centre, Auckland,1010
P O Box 3892, Shortland Street, Auckland,1140
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0800 303 308
If you are unsatisfied with our proposed resolution of any complaint or if we have not responded within 5 days , then you may contact the Privacy Commissioner to resolve that complaint at:
New Zealand Privacy Commissioner | Website: www.privacy.org.nz | Phone: 0800 803 909