Asset Allocation Strategy for 2022

investment strategy

Asset Allocation Strategy for 2022

By

Paul Ashworth, Managing Partner
Anne-Marie Tassoni, Partner
David Clark, Partner
Tristan Bowman, Director


Posted 20 January 22

The rapid rise in new cases across the world through Omicron is a timely reminder that new variants and cases are likely to remain a risk to market.

New Year, New Variant

The rapid rise in new cases across the world through Omicron is a timely reminder that new variants and cases are likely to remain a risk to market activity for the next 12 months (or longer). Thankfully, on a positive note, the total deaths attributed to Covid is trending downwards, implying that the new variants are more infectious but less deadly to the vaccinated. Through increased knowledge and understanding combined with booster vaccination and newly approved anti-viral therapeutics (Merck & Pfizer) countries will be better placed for pandemic/endemic policy and management.

In part 1 of our 4-part 2022 Economic and Investment Strategy Guide, we focus on the asset allocation implications of the current investment paradigm. We approach our economic forecasts from a balance of risk perspective, weighing the tailwinds and headwinds that face economies and investment markets. We expect 2022 to be a year of reasonable positive economic growth, as business and consumer spending recovers from the impacts of pandemic restrictions and fiscal policy remains accommodative.

However, the strong economic growth tailwinds of 2021 will ease throughout 2022, with still reasonable economic growth adding to inflationary pressures and the need for monetary policy tightening (higher bond rates). Overall, we expect this shift in monetary policy and the current high market valuations will lead to lower (but positive) equity returns for investors in 2022, and this drives a moderately pro-risk bias.

For further investment analysis, please see our in-depth report on Asset Allocation Strategy, including a discussion of the Top 5 Investment Risks for 2022, by clicking here.

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Peace of Mind Investing

Cameron Harrison have been advising business owners and their families on asset allocation and intergenerational wealth management for over 50 years. We have demonstrated over a long period our ability to manage investments through both the good times and bad by keeping the client at the centre of our business.

For more information on our approach to investment strategy or any other inquiries, please contact us on +613 9655 5000.