Premier Miton’s Gervais Williams has warned that as headwinds including a slowdown in the Chinese economy become more apparent, a “long period” of high-beta underperformance looks likely.
Williams, who is co-manager of Premier Miton's Diverse Income Trust and MicroCap Trust, said that going forward in 2022, the current slowdown in the Chinese economy will prove to be "structural" in nature. He said: "Just as happened in Japan in 1989, China's giant debt burden combined with its aging demographics will lead to a sudden cessation of its growth trajectory, in our opinion. "Alongside, after the pandemic stimulus, long-dated bond yields are now close to zero, so they have very little scope for any further appreciation in asset valuations either. At some point, the favourabl...
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