PA Adviser spends a week in the life of Keith Balmer, portfolio manager, multi-asset solutions (EMEA) at Columbia Threadneedle. Week commencing 5 October.
Monday
As is usually the case on a Monday morning, my body is still reminding me of the previous weekend’s sporting activities. I like to think I am still in my 20s, but the reality is that recovery takes considerably longer than it once did.
The grey matter gets a workout at weekends too. Long dog walks through the countryside provide the perfect opportunity to catch up on podcasts covering economics, markets and politics.
Our weekly team meeting at 9:30am is always one of the more interesting sessions of the week. This week we have had time to digest the weaker-than-expected employment data released on Friday and consider what it might mean for markets and portfolio positioning.
The prospect of less monetary tightening is supportive of our pro-risk stance, and it is encouraging to see equity markets rallying across Asia before the strength extends into global markets throughout the day. Once again, AI and AI-related companies are leading the charge.
Tuesday
Today is a roadshow day.
The sales team has organised a client lunch in Nottingham and a client dinner in Manchester.
Before setting off, I join our 8:45am investment floor meeting.
This week’s discussion is dominated by sharp moves in government bond yields, particularly in France. Only a week earlier our team had become more constructive on US government bonds, believing that inflation concerns and expectations for further rate rises from the Fed had become excessive. While we expect this view to take weeks or even months to play out, it is impossible not to pay extra attention to market moves immediately after putting a trade on.
I always prefer interactive discussions rather than formal presentations, as the questions advisers ask, and equally those they don’t ask, provide valuable insight into investor concerns, with AI and government debt sustainability dominating today’s discussions.
Every Tuesday afternoon we hold the Universal MAP risk meeting, which this week I attend from somewhere on the M1 between Nottingham and Manchester. The independent risk team runs through its weekly analysis of portfolio positioning – plenty of charts and statistics, but a vital part of the investment process. Who says fund management isn’t glamorous!
Wednesday
Wednesday is devoted largely to research and learning.
Following the daily macroeconomic update from our senior economist, Anthony Willis, and the accompanying market debate, we move on to presentations covering ongoing research projects.
Today, our Dutch office presents a fascinating new AI-driven tactical asset allocation model. Although still in its early stages, the work highlights how artificial intelligence can analyse vast quantities of data, to support better investment decisions, even if market forecasting will never be a perfect science.
The next meeting is our quarterly review with the systematic equity team, which manages a meaningful allocation within the Universal MAP portfolios.
This quarter, their income-oriented strategy continues to perform strongly, but it is equally encouraging to see their growth strategies enjoying a positive period.
My final meeting of the day is with a commodities specialist from an independent research house. Some of the best investment ideas emerge not from confirming what you already believe, but from listening carefully to a well-informed alternative perspective.
Thursday
Overnight, the minutes from the latest Federal Reserve meeting were released and the immediate reaction was another rise in government bond yields, continuing a move that has dominated discussions throughout the week.
While higher yields can create short-term volatility for both equities and bonds, they also increase future return expectations and can create opportunities for long-term investors. The challenge is always separating short-term market noise from a genuine change in the underlying investment outlook.
The next meeting was considerably less focused on markets and much more focused on people. We received a briefing on our upcoming Universal MAP event in November, which is shaping up to be one of the largest adviser events we have held.
Alongside investment presentations, there will be panel discussions featuring industry leaders discussing best practice, regulatory change and emerging trends within the financial advice sector. The headline attraction, however, will undoubtedly be a keynote address from Sir Clive Woodward. Having watched England win the 2003 World Cup in Bangkok while on a business trip I’m looking forward to meeting him – perhaps I can get his autograph alongside Martin Johnson’s. World Cup-winning captain and coach on one jersey!
The afternoon was spent looking at potentially enhancing our securitised credit strategy for inclusion within the higher-risk Universal MAP portfolios, including opportunities for additional floating-rate exposure.
By the end of the day, the discussion had moved from central bank policy and bond yields to adviser conferences and securitised credit. It struck me that this variety is one of the reasons I still enjoy the role so much after all these years.
Friday
By Friday morning, government bond yields remain a dominant talking point. What began as a reaction to the hawkish tone of the Federal Reserve minutes has developed into a broader discussion around whether markets have become too optimistic about the pace and extent of future interest rate cuts.
Much of the morning is spent catching up on portfolio administration and Friday afternoons provide an opportunity to spend some uninterrupted time reading research.
Before I shut down my computer, I take one final look at markets and review the week’s performance. Equity market performance has been mixed, however EM has sold off more than others, meaning our tactical overweight has given back a little performance. US government bonds yields are lower which has been good for us. The US dollar has stopped strengthening and consolidated over the week, meaning our hedge didn’t impact on returns. Overall, our tactical tilts have been flat at a portfolio level for the week, not great, but could have been worse, and year to date, still nicely ahead.
Of course, after a week spent travelling, analysing data, debating investment ideas and meeting clients, there is also the prospect of the weekend ahead. That will almost certainly involve hockey, dog walks, economics podcasts and, if history is any guide, old man aches and pains in time for Monday morning.
