Investing involves taking risks—but not blindly. In financial markets, prices move daily, and higher prices both increase risk and raise the bar for further returns. In the real world, some risks are costly to protect against, and some offer little compensation for sticking your neck out. But others are underappreciated, providing opportunities to generate attractive returns and mitigate risk at the same time. As we look at the world, we see a few risks that offer both pitfalls and potential returns for investors: energy infrastructure, chip scarcity, and ongoing government deficits. Against a backdrop of high stockmarket valuations and high apparent faith in central banks, these risks point to a cautious outlook for broad markets, particularly if inflation proves sticky. But for a bottom-up investor, these same risks offer attractive pockets of opportunity.
Learning objectives:- Understand how the semiconductor ecosystem works and why energy is an important consideration for chip manufacturers
- Explain how the energy system works and which companies are likely to benefit from the energy transition
- What impact government deficits have on opportunities within stock and bond markets
- Understand how inflation affects multi-asset portfolios and inflation-resilient assets
Presenters

Katrina Lloyd
Editor-in-Chief, Professional Adviser

Matthew Spencer
Head of UK Retail, Orbis