Partnership Aims To Boost Investment Returns

Investment strategy: Where are the opportunities?

This new business relationship will see AICML and AIMCo develop analytical methodologies applied to certain AIMCo investment models. Cameron Schuler, executive director at AICML, says his teams role will be to add valuable insights that will support AIMCos decision-making process. Machine learning combines a number of advanced computing methodologies so computers can independently learn from massive amounts of data, interpret trends and continually adapt dynamically to changing conditions, he explains. With our researchers skill sets we are able to adapt machine-learning methodologies to a broad range of environments, including investment management. AIMCo is providing the subject-matter expertise, and AICML is providing the technological know-how. David Goerz, executive vice-president of investment strategy and risk management at AIMCo, highlighted the importance of the partnership. Collaboration with AICML provides an exciting opportunity seeking to improve the predictive quality and adaptive capabilities of our asset class models by leveraging this world-class research group, he says.

Although cash looks unattractive in its own right, we maintain an overweight position tactically as we expect a likely upturn in volatility near term; tellingly, a larger-than-usual cash holding allows us to capitalise on any mispriced opportunities which may emerge as risk assets sell off. Stocks and their pre-crisis highs Understandably, it The Elevation Group can unnerve investors when stock markets regain and exceed previous peaks; a case in point is the S&P 500 which has hit all-time highs. The strong post-crisis performance can be explained by not just the expansion of valuation multiples but also earnings growth. Of note is that most major indices remain below pre-crisis peaks (see chart) and thus global equity market performance will necessarily need to broaden out. Arguably, the case for broadening out is also evident from sector performance seen to date: Of the key index components, the healthcare sector is nearly 50 per cent above the pre-crisis peak and the underperforming sectors are financials - lagging the most - and information technology, where earnings have increased the most. In addition, we expect the return on equity (ROE) of the developed bloc to move higher from the current level - marginally below the 10-year moving average - as the economy grows alongside the slower pace of deleveraging.