Also, stresses in markets appear to be increasing, particularly over the decline in oil prices. Liquidity is constrained in the bond markets as dealers have reduced inventory and staff. With income limited in the bond markets and extended stock prices calling into question the potential for further broad-based price gains, a robust and diversified income stream has the potential to support total returns even if price gains falter.
We live in uncertain times, amid a slow and fragile recovery from a global financial crisis. With equity prices broadly elevated, an unconstrained, income-focused global equity strategy that is skewed to attractively valued companies operating in faster growing regions remains an attractive option.
Pat Ryan is fund manager and analyst on the Lazard global equity team
KEY FIGURES
25%
Approximate percentage of the US market that pays no dividend at all
2%
The Federal Open Market Committee’s (FOMC) inflation target for the US
5.5%
The unemployment rate in the US in February, deemed an important factor in the FOMC’s decision to raise rates
