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Stefan Keitel By Beverly Chandler, Opalesque London
The Global Chief Investment Officer at Credit Suisse Asset Management and Private Banking, Stefan Keitel, has come out in favour of commodities and the diversification benefits of hedge funds in the fourth quarter report from the bank.
For commodities, Keitel believes that while gold experienced sharp price swings in the third quarter, the price retrenchment is a potential opportunity to re-enter the market once macroeconomic data stabilizes, rather than a trend reversal for the precious metal.
In terms of alternatives generally, Keitel says: "In challenging markets, we continue to believe portfolio diversification is key to negotiating the uncertainty in today’s financial markets, including a visible allocation to alternatives. Alternative investments, in our view, provide access to different drivers of returns than traditional asset classes, making them important components in the search for potential, higher risk-adjusted returns".
CSAM is currently overweight hedge funds as they believe that their diversification benefits were evident during the third quarter’s market turmoil. "However, not all hedge fund styles performed uniformly to the current situation. We believe that more risk-averse investors may want to reduce positions in equity hedge funds, and maintain an allocation to a mix of global macro and event-driven strategies that can capitalize on the shifting conditions in the world’s financial markets."
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