Are active managers right to be gearing up for recession?

Preparing for the worst despite upbeat sentiment

Over the past year, or possibly even longer, these pages have covered senior investment professionals predicting the end of the decade-long bull run in equities, but despite some rough patches stockmarkets have continued to rise.

Even after the sell-off across asset classes in the second half of 2018, stocks have returned to an upward trend and although Brexit and geopolitical uncertainties remain a threat, investors seem more upbeat than they did six months ago. However, a new report has said active managers are gearing up for a recession in the next one to two years, pointing to the US Treasury yield curve and unemployment figures as red flags. A write-up of Moody's US Asset Management Conference, held on 20 March, said the panel of managers are de-risking their portfolios as the US economy - traditionally t...