The unexpected equity market returns of last year are unlikely to continue over the coming 12 months and, against the backdrop of protracted geopolitical concerns, a more benign, muted environment should be expected, according to GSFM and its fund manager partners, Munro Partners and Tribeca Investment Partners.

GSFM adviser, Stephen Miller, says the extent of the strong returns from global equities last year (as well as in Australia) came as somewhat of a surprise, and investors should recalibrate performance expectations to be around the mid-single digit mark for 2020.

He says such a forecast implies a reasonably benign global and domestic growth outlook; however, risks to the downside abound.

“Monetary policy is almost exhausted, and ongoing global tensions, such as the US/ China trade negotiations, US and European politics, Hong Kong and more recently Iran, mean that risks may be asymmetrically weighted to the downside.

“2019 surprised us by how bloody good it was and when it’s good, markets can become complacent. When something goes wrong, the correction might be shorter but it can also be deeper and investors need to be alert to that potential.

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