An Investor's Log, Week 13

The dashboard:



The ChatGPT summary: 

The dominant macro theme this week remained the interaction between geopolitical risk, inflation expectations, and monetary policy. Although military tensions surrounding Iran continued to generate uncertainty, markets increasingly focused on the possibility that diplomatic progress could prevent a sustained disruption to global energy flows. As a result, crude oil prices remained volatile but failed to generate the type of broad risk-off response that investors feared earlier in the month.

At the same time, central banks became more visibly concerned about the inflation implications of elevated energy prices. Several European Central Bank officials signaled that policy may need to remain restrictive for longer and even hinted that additional tightening could become necessary if energy-driven inflation begins feeding into wages and services prices. Recent inflation releases from Germany and Spain reinforced the perception that inflation is proving more persistent than many investors expected.

A second, less appreciated development remains the ongoing normalization of Japanese monetary policy. The Bank of Japan continues to shrink its balance sheet and operate in an environment of rising domestic yields. While Japanese equities performed well this week, the longer-term implications are potentially significant because higher Japanese yields could encourage domestic investors to repatriate capital from overseas markets, affecting global liquidity conditions and sovereign bond markets.

Against this backdrop, global equities continued to perform well, particularly quality-growth and technology-oriented assets. Your portfolio benefited from this environment through strong performance from global growth, global dividend, and Japanese equity holdings. The strongest contributor was the global growth allocation, while Japanese equities delivered the largest percentage gain. Commodity-related positions underperformed as investors partially removed geopolitical risk premiums from oil and precious metals. Gold weakened despite continued uncertainty, reflecting stronger risk appetite and concerns about higher real interest rates.

The portfolio remains conservatively positioned with more than 38% held in cash, substantial gold exposure, limited bond duration, and a moderate tilt toward global quality-growth equities. This structure has insulated the portfolio from many macro risks while preserving optionality. The principal risks now stem from a potential second inflation wave, a disorderly rise in Japanese yields, and increasingly crowded positioning in global equities.

Suggested adjustment: reduce the anti-inflation fund position by approximately one-third and reallocate the proceeds into global quality-growth equities while maintaining the existing core gold allocation.

Comments

Post a Comment

Popular posts from this blog

Family education is not that important

(translated from my Chinese blog) This is my new project, “Nietzschean Philology”. In each installment, I’ll read a passage from Nietzsche’s original writings. By practicing text analysis, we can enhance our ability to understand the world. The reading of "We Philologists" continues. Section 11 continues the discussion of external factors hindering genius individuals from the previous section, shifting from professional education (unqualified philologists) to family education. It's no surprise that Nietzsche views the importance of family education very lowly; ultimately, there are too few cases where families can provide the life possibilities for geniuses. Let it be considered how differently a science is propagated from the way in which any special talent in a family is transmitted. The bodily transmission of an individual science is something very rare. Do the sons of philologists easily become philologists? Dubito. Thus there is no such accumulation of philological c...
Read more

The value of life depends to a great extent on pure hazard

(translated from my Chinese blog) This is my new project, “Nietzschean Philology”. In each installment, I’ll read a passage from Nietzsche’s original writings. By practicing text analysis, we can enhance our ability to understand the world. "We Philologists" Section 1. Starting from the two main themes of classical linguistics and education, Nietzsche discusses how the specialization of education leads to premature decisions that result in foolish choices in life. He also explores the dilemma of choosing a career: it’s impossible for a person to know what kind of career they should pursue while actually engaging in that career at the same time. As a result, life becomes something determined purely by chance. To what a great extent men are ruled by pure hazard, and how little reason itself enters into the question, is sufficiently shown by observing how few people have any real capacity for their professions and callings, and how many square pegs there are in round holes: happ...
Read more

Can Writing be fun?

 My dear friend suggested, after reading my last post, that writing can have more than one purpose, and what I was arguing, namely writing as a form of thinking, was merely one of the many purposes for writing. For instance, writing can be for remembering; writing can also be for fun. Now I would like to leave the remembering part for the next post. For now, let's talk about fun. Can writing be fun? Yes. But what kind of fun is that? To answer this question, there are basically two approaches, both of which lead to the same conclusion. I will start with the easy approach: the supply side of the fun. Now, what are the things that are mostly considered fun? Entertainments. Movies. Music. Video games. Hanging out with friends. Partying. Sightseeing. Travelling. TikTok. Youtube. Netflix. These things can be placed into an imaginary spectrum, with one side being totally brainless, and the other side requiring some sort of effort. Let's take music for example. Listening to music can ...
Read more