It goes without saying that global stock market performance has been extraordinary during the past year. The S&P 500, for instance, is up 65% since its low last March and nearly 16% for the year. The Nasdaq, laden with technology stocks, is 44% higher for the year. Valuations are now trading at enormous premiums.
The wider stock market is clearly being powered by expectations of strong growth after vaccines have been extensively distributed and the economy fully opens. One thing, arguably, the pandemic has underscored is that it is a forwardlooking medium. But now it is probably more about future expectations than current conditions.
We spoke to Coronation Fund Managers’ Neil Padoa about current trends. Head of global developed markets and portfolio manager there, he graduated with a Bachelor of Economic Science at Wits University and is a fellow of the Faculty of Actuaries. With 13 years’ investment experience under his belt, he worked as a management consultant at Bain & Co, an equity analyst in London; and joined Coronation in May 2012.
Although the US equity market has grown to represent 61% of the FTSE World Index, does it still offer good value?
We evaluate each stock on its own merits, and yes, even in the US, we are still finding a mix of competitively entrenched businesses, and highly innovative companies with strong growth prospects.
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