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Wealthy Keep Money: A Morning Breeze



<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Wednesday, November 13, 2019"data-reactive =" 15 ">Wednesday, November 13, 2019

<h2 class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "While professional investors dive into the market"data-reactive =" 16 ">While professional investors dive into the market

Wealthy people keep money in their portfolios.

Meanwhile, active investors are now jumping on the market with the most enthusiasm since the election.

And this divergence is a sign of tensions in the tensions market next year as investors continue to radically re-think the economy in 2020.

In the latest investor-driven survey released Tuesday, UBS Global Wealth Management revealed that wealthy investors still have 25% of their portfolios in cash, higher than the 5% allocation the firm usually recommends. The survey, which surveyed more than 3,400 investors in 13 markets, also indicated that 60% of investors would consider further raising their own money.

So while 69% of respondents in the survey are "optimistic" about coming back over the next decade, nearly three quarters of those surveyed see the environment as more problematic now than five years ago, with 79% saying we are heading for a period of greater volatility.

Wealthy investors, in other words, are still preparing for something bad to happen to the economy.

<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "But this cautious short-term view of wealthy individuals stands out from the complex professional investor who has increased his bets on the market with & nbsp;In 2020, the recession is becoming fully appreciated& nbsp; in the last few weeks. "data-reagid =" 23 "> But this cautious short-term view of the wealthy is unlike the professional investor set that has upgraded its bets on the market with a recession in 2020. Completely priced in recent weeks.

Bank of America's fund manager month-to-month research released on Tuesday revealed that "FOMO" – or "Fear of Missing" – has led to "a wave of optimism and a jump in capital and cyclical exposure".

"The bulls are back," said Bank of America strategist Michael Hartnett.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "How & nbsp;we noticed yesterday's morning breeze, investors are increasingly placing bets that better than expected growth next year will keep the market powered. And by better than expected we mean basically no growth. "Data-reagid =" 46 "> As we noted in yesterday's morning briefing, investors are increasingly betting that better-than-expected growth next year will keep powering the markets And, better than expected, we are thinking of any growth.

In November, a net 6% of investors said they expect the global economy to improve over the next 12 months, an increase of 43 percentage points from the previous month. It was the biggest month-long jump in record economic expectations, according to Bank of America.

So while nearly two out of every three investors surveyed in October, the global economy is deteriorating in 2020, just over half of those surveyed in November believe the global economy will actually improve next year.

Surprisingly, cash flow among fund managers has fallen sharply over the past month and now represents only 4.2% of portfolio visits, the lowest level since June 2013.

And so the division here is obvious: the rich already remain defensive and those who make active bets on the market first dive into the head.

Of course, the goals of each group vary widely. Preserving wealth is very different from creating wealth. But the gap between enthusiasm and enthusiasm separates between these two important constituencies as the market continues to set new heights while so few are truly enthusiastic.

<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "By & nbsp;Mills Undland, rapporteur and co-anchor of & nbsp;Final round.& nbsp; Follow & nbsp;@MylesUdland"data-reactive =" 52 ">From Mills Undland, rapporteur and co-anchor of Final round. Follow him @MylesUdland

What to see today

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  • 7 o'clock. ET: MBA Mortgage Applications, Sunday ended November 8 (-0.1% before)

  • 8:30 am. ET: Consumer Price Index from month to month, October (expected 0.3%, 0.0% in September); CPI excluding food and energy from month to October (expected 0.2%, 0.1% in September); Environmental Index, year-on-year, October (1.7% expected, 1.7% expected in September); CPI excluding food and energy year-on-year, October (expected 2.4%, 2.4% in September)

  • 2 p. ET: Monthly Budget Report, October (- US $ 128.2 billion, US $ 82.8 billion expected in September)

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Pre-market

Post-market

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<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "From Yahoo Finance"data-reactive =" 67 ">From Yahoo Finance

  • Federal Reserve President Jerome Powell is in Capitol Hill today to begin a two-day testimony before Congress. At 11 PM ET, set Powell in front of the Joint Economic Committee to discuss the economic outlook.

  • Brian Succi spoke with DF CFO Tom Swir. Watch the Yahoo Finance interview during the day from 9am to 5pm. ET

Top news

SHANGHAI, CHINA – JANUARY 07: A Tesla Model 3 is unveiled at the Tesla Shanghai Gigafactor's breakthrough ceremony on January 7, 2019 in Shanghai, China. (Photo: angang Shengwei / Chinese News Service / Visual Chinese Group via Getty Images)

<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Elon Musk will build the first European gigafactory in Berlin [Yahoo Finance UK]"data-reactive =" 92 ">Elon Musk will build the first European gigafactory in Berlin [Yahoo Finance UK]

<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Inflation plummeted to a three-year low after the UK cut energy bills [Yahoo Finance UK]"data-reidid =" 93 ">Inflation plummeted to a three-year low after the UK cut energy bills [Yahoo Finance UK]

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