Adapting to a new reality, says AD Investment Management's 2021 outlook

Adapting to a new reality, says AD Investment Management's 2021 outlook

PR Newswire

DUBAI, UAE, Feb. 15, 2021

DUBAI, UAE, Feb. 15, 2021 /PRNewswire/ -- With fiscal stimulus and deficit spending to remain integral in global macroeconomics, coupled with yield curve control and vaccine rollouts accelerating the evolution of a "new normal," the investment landscape in 2021 may reflect a continuation of the reflation/momentum trade, albeit at increased volatility.

 

Yazan Abdeen CEO of ADIM

 

This is a key take-away from this year's outlook letter by AD Investment Management (ADIM), titled "2021: Navigating Icarian Markets." ADIM, regulated by the Abu Dhabi Global Market's (ADGM's) Financial Services Regulatory Authority (FSRA), is a Middle East-focused asset management boutique sponsored by Invest AD.

The firm's forecasts for the MENA region highlight several considerations for investors, including:

"Markets in aggregate seem to be currently priced to beyond perfection, where a lot needs to go right on the path to projected growth for them to justify their valuations," said ADIM's Annual Outlook Letter. "Even then, they are not offering the kind of returns one would hope for over the next decade from where we are today."

Amid expensive assets across the spectrum, the firm believes that a good hedge against the inevitable reversal of the momentum trade could be growing exposure to selective names that correlate with these factors.

"We cannot predict the timing of that reversal, but we know we are moving closer to it with every passing day," added the Letter.

A selective approach in the Middle East

By staying focused in its convictions, ADIM sees various themes within MENA states that can provide resilience and performance in portfolios this year, and beyond. For example:

Secular themes

Cyclical themes

Leveraging appetite for sustainability

The report also notes the region's steepening awareness regarding climate challenge and highlights the opportunities and concrete steps being taken by leading regional National Oil Companies to reduce the carbon footprint. Moreover, the region's mineral wealth coupled with the adoption of investor-friendly mining laws may contribute to improving FDI. This is based on the expected secular demand for industrial metals that is supported by the theme of "electrification of everything" and the decarbonization of the electric grid.

Click this link for more insights on various opportunities, risks and considerations in 2021.

About AD Investment Management

AD Investment Management (ADIM), a specialized Middle Eastern asset management boutique, is domiciled in the Abu Dhabi Global Market and regulated by the ADGM's Financial Services Regulatory Authority (FSRA). Founded in 2019, ADIM is a subsidiary of the Abu Dhabi Investment Company (Invest AD). Abu Dhabi Investment Company was established in 1977, by decree of the late President of the UAE, HH Sheikh Zayed Bin Sultan Al Nahyan. Abu Dhabi Investment Company is a subsidiary of the Abu Dhabi Investment Council, which is a part of the Mubadala Investment Company owned by the Government of Abu Dhabi.

ADIM's mission is to provide clients, capital markets and shareholders with sustainable investment solutions by committing smart people, independent financial thought and disciplined processes.

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