Sunrise on Venus: Preparing for the investment environment of the next decade
Venus goes 117 days, or nearly four months, between sunrise and sunset. With days so long, it’s easy to imagine growing used to day or night, rather than thinking of the next sunset. We’ve been through something similar in the investing world. Growth and passive strategies have enjoyed a long day in the sun, but investors have grown too complacent about them, positioned as if the sun will never set. With valuations and positioning where they are, that makes the coming sunset dangerous.
Investors can prepare for sunrise by getting properly diversified, across economic exposures and across styles within equities. Fortunately for active investors, there are thousands of opportunities to choose from, and we’ve found many diversifying shares that are trading at a discount.
Using long-term data, this paper looks at how we got here, which equities are at risk, why the investing world is changing, and how investors can prepare for the decade ahead. With the right active strategies, investors can look forward to sunrise, rather than fearing sunset.