Jupiter CEO Edward Bonham Carter has called into question the equity market rally, suggesting current moves do not yet signal the start of a new bull market.
Speaking at the group's investment dinner, Bonham Carter (pictured) compared the market rally with the horsemeat food scandal, asking "where is the beef in the bull market?"
Global equities have powered ahead at the start of 2013, continuing the trend seen in the latter half of 2012 as fears over the future of the eurozone ease and investors ponder a 'great rotation' from bonds to equities.
But the Jupiter chief executive said the exuberance seen in the early 1980s and end of the 1990s had little in common with today's equity market conditions, and drew comparisons with the bear market of 1966-1982.
"The Dow Jones tried to go through its highs a number of times between 1966 and 1982 but kept falling back. There were lots of head fakes. This is not the bull market of 1982.
"At the moment it is actually a horse disguised as a bull."
The CEO suggested the initial signs of a shift from bonds to equities could well continue, and said equities remain "faute de mieux - the least bad option".
However, he suggested investors should be wary of being caught out by the post-crisis environment.
"The compass has been recalibrated, and the new normal is something you have no sense of. It is very hard to work out objective asset prices...That means you have to retreat and go back to fundamental analysis."
Turning to Jupiter's own progress, the CEO compared Jupiter's evolution with geological eras, and suggested the company is now in its ‘Cenozoic' period - a time of growth that will be driven by new distribution and strategy director Maarten Slendebroek.
"This period is now all about growth, which is Martin's strength," Bonham Carter said. He pointed to the group's private client business as having particularly strong future growth potential.
He added that the challenge for fund managers is to demonstrate their active stockpicking abilities, urging them to "come out of the closet" and show they can justify charges by generating outperformance.
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Via The Exchange
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