Take profits or run the risk of a correction

Dilemmas facing the modern-day active manager

While the turnaround in central banks' tone since the beginning of the year helped boost equity prices and dampen volatility, it looks highly unlikely this is enough to maintain a longer term rebound.

The impressive V-shaped movement we witnessed in recent months complicated strategists' and portfolio managers' work; market timing in particular is proving to be quite tricky.  Those who reduced risk levels when markets crystallised all fears - without later increasing equities exposure - took a place on the sidelines during the year's first half. Furthermore, inflows into equity funds have barely been positive, meaning that strategists' traditional market timing techniques have failed. Fund managers slash exposure to global equities on trade war fears At first sight, those who...