1 January 2015
Since the recovery from the financial crisis, a common theme has been that artificially low interest rates* have forced investors to search for yield, which in turn has resulted in overpriced assets.
This narrative has been supported by the fact yield sectors, such as Global Real Estate, significantly outperformed the broader global equity indices in 2014 by approximately 10% (in USD terms).
As we enter 2015, consensus is for the US economy to maintain its recovery and the US central Bank to begin the long anticipated increase in interest rates. It follows that the “search for yield” will soon end, causing significant price disruption for yield style assets as we can get back to normal – with growth assets once again outperforming.
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