Citius, Altius, Fortius?

While investors can naturally rejoice over the rally across asset classes at the end of 2023, the end-of-year market action brings a lot of stocks back to stretched levels of valuation.
The unprecedented rate hikes of the last 18 months still impact our economies with the traditional lag, the Eurozone being expected to almost stagnate in the last quarter, and risks to next year’s growth still abounding. 
The short squeeze in the last two weeks of the year - which led the most shorted US names up more than 20% on the month or 15% above the broad Russell 3000 - is remarkable in these conditions. Speculation is high across Equity markets, as many indices reach new highs at the end of the year, and history shows these moves tend to be followed by reversals for low-quality names. The recent move is very similar to the market action of last July, and many non-profitable growth names look very vulnerable again.

Value opportunities also abound within Emerging Markets Equities - where China is finally making a comeback into our strategies - within EM Debt and across developed Small/Mid Caps after their large respective under-performance. 
This dispersion in valuations across the market offers strong opportunities for active investment and we are looking forward to uncovering compelling return opportunities for our investors.

Our Quality and Value tilts -structurally embedded into our Systematic Equity strategies- and key dimensions in our Credit, Global Bond and Multi-Asset strategies should help us manage the potential volatility of this late phase of the cycle.
We remain focused on enhancing our research and investment platform while diversifying our strategies across frequencies and asset classes and are keen to engage with you on the value-added this will bring to our investment processes. In the upcoming months, we will share some research elements on topics such as Large Language Models fine-tuning for news-flow-based stock predictions, volatility term-structure inefficiencies, and credit default swaps’ cointegration.

Emmanuel Hauptmann
Partner, CIO & Head of Systematic Equities
 

________________

Disclaimer

The figures, comments, opinions and/or analyses contained herein reflect the sentiment of RAM with respect to market trends based on its expertise, economic analyses and the information in its possession at the date on which this document was drawn up and may change at any time without notice. They may no longer be accurate or relevant at the time of reading, owing notably to the publication date of the document or to changes on the market.
This document is intended solely to provide general and introductory information to the readers, and notably should not be used as a basis for any decision to buy, sell or hold an investment. Under no circumstances may RAM be held liable for any decision to invest, divest or hold an investment taken on the basis of these comments and analyses. 
RAM therefore recommends that investors obtain the various regulatory descriptions of each financial product before investing, to analyse the risks involved and form their own opinion independently of RAM. Investors are advised to seek independent advice from specialist advisors before concluding any transactions based on the information contained in this document, notably in order to ensure the suitability of the investment with their financial and tax situation.
Past performance and volatility are not a reliable indicator of future performance and volatility and may vary over time, and may be independently affected by exchange rate fluctuations.
This document has been drawn up for information purposes only. It is neither an offer nor an invitation to buy or sell the investment products mentioned herein and may not be interpreted as an investment advisory service. It is not intended to be distributed, published or used in a jurisdiction where such distribution, publication or use is forbidden, and is not intended for any person or entity to whom or to which it would be illegal to address such a document. In particular, the investment products are not offered for sale in the United States or its territories and possessions, nor to any US person (citizens or residents of the United States of America). The opinions expressed herein do not take into account each customer’s individual situation, objectives or needs. Customers should form their own opinion about any security or financial instrument mentioned in this document. Prior to any transaction, customers should check whether it is suited to their personal situation, and analyse the specific risks incurred, especially financial, legal and tax risks, and consult professional advisers if necessary.
The information and analyses contained in this document are based on sources deemed to be reliable. However, RAM Active Investments S.A. cannot guarantee that said information and analyses are up-to-date, accurate or exhaustive, and accepts no liability for any loss or damage that may result from their use. All information and assessments are subject to change without notice. Subscriptions will be accepted only if they are made on the basis of the most recent prospectus and the latest annual or half-year reports for the financial product. The value of units and income thereon may rise or fall and is in no way guaranteed. The price of the financial products mentioned in this document may fluctuate and drop both suddenly and sharply, and it is even possible that all money invested may be lost. If requested, RAM Active Investments S.A. will provide customers with more detailed information on the risks attached to specific investments. Exchange rate variations may also cause the value of an investment to rise or fall. Whether real or simulated, past performance is not a reliable guide to future results. The prospectus, KIID, constitutive documents and financial reports are available free of charge from the SICAV’s head office , its representative and distributor in Switzerland, RAM Active Investments SA, and the distributor in Luxembourg, RAM Active Investments SA. This document is confidential and addressed solely to its intended recipient; its reproduction and distribution are prohibited.  RAM Active Investments SA is authorised and regulated in Switzerland by the Swiss Financial Market Supervisory Authority (FINMA). Issued in Switzerland by RAM Active Investments S.A. which is authorised and regulated in Switzerland by the Swiss Financial Market Supervisory Authority (FINMA). Issued in the European Union and the EEA by the Management Company RAM Active Investments (Europe) S.A., 51 av. John F. Kennedy L-1855 Luxembourg, Grand Duchy of Luxembourg.
No part of this document may be copied, stored electronically or transferred in any way, whether manually or electronically, without the prior agreement of RAM Active Investments S.A.