Columbia Threadneedle's Colwell: Navigating monetary policy far bigger risk than Brexit

Very similar environment to dotcom bubble

Richard Colwell, head of UK equities and manager of the £4.1bn UK Equity Income fund at Columbia Threadneedle Investments, has said the big issue of how central banks navigate this period of quantitative tightening will create risks as well as opportunities, pointing to the polarisation of asset prices as one of the "unintended consequences" of quantitative easing (QE).

The manager said the current environment was very similar to the lead-up to the dotcom bubble in 2000 and 2001, whereby if the market viewed a stock as a disruptor there was no limit to its valuation, but there was no floor if a company was viewed as being disrupted. "As an active investor, that gives us opportunities to identify some of those disruptors that are "emperor's clothes" and could get disrupted themselves," he said. "It is about selecting business models which have been undervalued and actually may have the where-with-all to adapt." Colwell  also noted central banks had...