Imperium Capital Publication

Global Matters Weekly – 17 October 2022

Gilty Pleasures

by Alex Harvey, CFA — Senior Portfolio Manager & Investment Strategist

— A modicum of value has come back into the UK bond market

Three weeks ago, I had just landed in Morocco and with impeccable timing, as I worked out how to use Agadir airport’s ATM, Sterling tanked on the back of the UK government’s now well pored over ‘mini-budget’. I found it mildly amusing that the ticker for the Sterling-Dirham currency pairing is GBPMAD. It certainly felt like it! Of course, this wasn’t a bout of Dirham strength but a Sterling maelstrom resulting from the aforementioned budget, and the Pound was in freefall against every major currency.


Market Snapshot

  • Global equities fell by 1.7% last week
  • The International Monetary Fund released their latest round of economic projections leaving their 2022 global growth forecast at +3.2%, but downgrading 2023 to +2.7%
  • Brent crude fell by 6.4% over the week to $91.6 a barrel
  • Gold fell by 3.0% to $1644.47 per ounce

Global Matters Weekly – 10 October 2022

Welcome to the New Age

by Matt Connor — Investment Analyst

— The recent explosion of TikTok has made brands rethink their advertising strategies

Like it or not, there is no doubt that social media is now an integral part of our lives, with our online presence an extension of who we are, and for many, who they aspire to be.

There were almost three billion monthly active users on Facebook in the second quarter of this year, some 37% of the global population. For a business, social media offers a treasure trove of potential customers, but still so many seem to get it wrong when advertising through these channels.


Market Snapshot

  • Global equities returned 1.7% last week
  • World indices and commodities saw positive returns
  • Brent crude rose 11% last week to $97.9 a barrel after The Organization of the Petroleum Exporting Countries Plus announced a two million-barrel per day cut in target production
  • Gold rose 2.1% to 1694.8 per ounce

Global Matters Weekly – 3 October 2022

Data, data everywhere and not a number to guide

by Richard Parfect

— Humans like to have a number to hold onto as it feels tangible and brings confidence

All through life our brains like to use “general rules of thumb” when dealing with problems. These rules may come through personal experience or maybe they are more prescriptive and laid down by doctrine.

When dealing with problems I have sometimes found it useful to use a “factor of three”. For example, if I plan to do a DIY job in the house, bitter experience tells me it will take three times as long as I might expect. Such a guide can help avoid the shock of under-estimation of an outcome.


Market Snapshot

  • Global equities fell 2.6% last week
  • The UK’s ‘mini’ budget continued to cause carnage across financial markets. The International Monetary Fund urged the government to change the course of action
  • Brent crude rose 2.1% over the week to $87.96 a barrel
  • Gold rose 1.0% to $1660.61 per ounce

Global Matters Weekly – 26 September 2022

Calm before the storm

by Mark Wright, CFA

— We now find ourselves in the eye of an inflationary storm

Not long back from my first holiday abroad since the pandemic, I was looking out my window longing to be back swimming in the warm Mediterranean ocean off the East coast of Mallorca. I will spare you the details of the travel chaos we experienced both ways, it was a lesson learned!

I was expecting 10 days of sun and nothing much else weatherwise, but it didn’t quite turn out like that. We were fortunate enough to witness not just one but two thunderstorms. I say fortunate because they served as a healthy reminder that it is always calm before the storm.


Market Snapshot

  • Global equities fell by 5.1% last week
  • The past week saw 500bps of global rate hikes across 15 central banks including The Federal Reserve and the Bank of England
  • Brent crude fell by 5.7% over the week to $86.15 a barrel
  • Gold fell by 1.9% to $1643.9 per ounce

Viewpoint – August 2022

The rally in equity markets that started in mid June continued into the first half of August, taking Wall Street 17% off its June low, but was ultimately overwhelmed by the global energy crisis and extraordinary falls in bond markets through the month, reversing most of the gains of the previous two months. The biggest falls came in Europe, and most extreme was the UK, where yields on 2-year government bonds rose by 130bps, taking the yield to 3.0% at month end, the highest for 15 years. The UK 10-year yield also rose dramatically, up by 94bps to 2.8%. Eurozone bond markets fared only slightly better, with the German 2-year yield up by 93bps to 1.19% and the 10-year up 73bps to 1.54% over the month.

Global Matters Weekly – 5 September 2022

The Law of Lindy

by Tom Delic

— Often the most successful new businesses are centred around ideas that satisfy age-old basic human wants and needs.

In 1964, American author and academic Albert Goldman wrote an article in US magazine The New Republic, titled ‘Lindy’s Law’. While dining at Lindy’s, a New York delicatessen, Goldman became interested in the discussions that took place between entertainment industry veterans who frequented the restaurant and would analyse the latest televised comedy shows. While the Lindy effect is a useful heuristic to apply across many aspects of our lives, we can also use it as a filter in the portfolios we manage for clients.


Market Snapshot

  • Global equities fell by 3.3% last week
  • Commission President Von der Leyner is considering various measures to deal with the current cost of living turmoil
  • Brent crude fell by 7.9% over the week to $93.0 a barrel
  • Gold fell by 1.5% to $1712.2 per ounce

Global Matters Weekly – 22 August 2022

Navigating fund fees and finding value

by Gary Moglione

— New regulations in the UK are making it increasingly difficult for multi-asset funds to hold investment trusts.

As investors in the investment trust market, we have seen the UK market grow significantly over the years. In addition to diversification and access to many asset classes not usually available to retail investors, closed-ended trusts have significantly outperformed open-ended funds over the long term. In the UK, over the ten years to September 2021, the average investment company returned 265% versus the average open-ended fund returning 70%.


Market Snapshot

  • Global equities fell by 1.6% last week
  • In Ukraine, talks with President Zelensky, UN Secretary General António Guterres, and Turkish President Recep Tayyip Erdoğan were held in Lviv with Turkey acting as the key interlocutor between Ukraine and Russia
  • Brent crude fell by 1.5% over the week to $96.7 a barrel
  • Gold fell by 3.1% to $1747.1 per ounce

Viewpoint – July 2022

After a torrid six months, with global equities suffering a 20% decline and most developed world sovereign bond markets producing negative returns each month in the first half of this year, there was finally relief in July. Led by Wall Street, with the S&P 500 up over 9% in the month, the MSCI World index returned 7.9%, while the JPMorgan Global Government Bond index returned 1.9%. Riskier parts of the bond market, which had sold off heavily in the first half of the year, recovered sharply, with US investment grade bonds +3.2%, high yield bonds +5.9%, and emerging market debt +4.0%.

Global Matters Weekly – 15 August 2022

Change – it’s a constant

by Gary Moglione

— We need to operate closer to the frontiers of where technology is going.

Back in February I gave a sob story of my childhood of how the 1970s and early 80s saw “austerity” hit my household, including my father’s industrial clothing factory closing down. Recent developments on the Continent, brings another childhood memory to mind; cold housing. Admittedly, the central heating system, decades past its use by date and an insufficiently insulated house, was not conducive to staying warm. However, an article caught my eye in the Financial Times this week that showed the average temperature in British homes has risen considerably since the 1970s; even those that actually had central heating in 1971 saw average temperatures rise from circa 14C to 18C today.


Market Snapshot

  • Global equities returned 3.0% last week, marking the first fourth consecutive weekly advance this year
  • Stocks rallied after US data showed signs that inflation, while still elevated on an annualised basis, had started to slow
  • Brent crude rose 3.4% last week to $98.15 a barrel
  • Gold rose 1.5% last week to $1802.4 per ounce

Global Matters Weekly – 08 August 2022

Shinzo Abe; a tragic death but a promising legacy

by Robert White, CFA

— Japanese equities should form an important part of any truly global portfolio today.

Japan has been in the headlines for the sad and shocking death of Shinzo Abe, one of the few truly visionary democratic leaders in modern times. The former Prime Minister was instrumental in transforming Japan’s economic and military ambitions, and while both remain a work in progress, he became a revered figure on the international stage. As investors, we are optimistic about the opportunity in Japanese equities; not only are they cheap, but nascent structural reforms and robust corporate profitability should provide a healthy tailwind over the coming years.


Market Snapshot

  • Global equities rose 0.6% last week
  • China responded to US House Speaker Nancy Pelosi’s visit to Taiwan with 3 days of military tests and drills that encircled the island
  • Brent crude fell by 14.4% over the week to $94.12 a barrel
  • Gold rose 1.4% to $1790.57 per ounce