Macroeconomic outlook of markets for the second quarter

At the beginning of the second quarter we witnessed an attempt to reverse the outlook observed in the first quarter, with bond yields falling and technology stocks returning to higher levels. Macroeconomically, investors are concerned with three issues:

1. If inflation has peaked and will move to lower levels. This is something that will become clearer by the end of the year when the extreme movements in the commodity markets will have smoothed out and the activities of the supply chain will have returned to normality.

2. If we are at the peak of economic growth. In the coming months, it would be normal for the growth rate to almost reach the long-term average.

3. If unemployment rate will continue to decline. In our view, if tourism incurs a better year in the US, unemployment will be significantly lower.

All of the above triggered small turmoil in the markets as in the second quarter the technology sector made a dynamic comeback and the so-called re-opening trades lost some of their momentum. However, the composition of XSpot Wealth's portfolios proved to be effective and therefore, the portfolios moved upwards and recorded significant returns, always in relation to the benchmarks.

XSpot Wealth Portfolios’ Returns

All of XSpot Wealth's investment portfolios completed an excellent second quarter which was what gave our portfolios the most momentum.

Of all the investment portfolios, the one that stood out was High Income Portfolio, which recorded top returns and for this year is the best portfolio, surpassing the corresponding benchmark portfolio. In addition, investors in this portfolio have already received dividends of 3.5%. The Growth ESG portfolio also had an excellent course and we estimate it will continue to offer strong returns in the long run.

At a time when many investors are distracted from the purpose of investing and wonder if it is a good time to start investing and while many others abstain from investing considering the markets expensive, it becomes clear that they have lost an excellent first half of the year in terms of returns on their capital.

What changes were carried out in the investment portfolios in the second quarter?

During the second quarter, there came up a significant opportunity to increase the XSpot Growth portfolio exposure to equities. As a result, the account managers’ team of XSpot Wealth, zeroed its positions in US government long-term bonds (20+) and at the same time increased its positions in the Value stock sector while it opened positions for the first time in the banking sector.

Value stocks recorded better valuations during the second quarter, while the banking sector offers a significant profit opportunity in the coming quarters, considering that economic conditions remain stable and banks have trillions of funds ready to lend.

How do we proceed with the second semester?

Once again, a clear investment plan with a clear orientation and effective risk management remains more effective than any other investment mindset. No matter what the markets are expected to do in the second half, we at XSpot Wealth focus on the only thing that has value: the right diversification, which allows long-term portfolios to generate value by going through every good and bad economic cycle.

Please remember that past performance is not a reliable indicator of future performance

This document does not constitute and shall not be construed as a prospectus, advertisement, public offering, or placement of, nor a recommendation to buy, sell, hold or solicit, any investment, security, other financial instrument or other product or service. This document is for general information only and is not intended as investment advice or any other specific recommendation as to any particular course of action or inaction.