15 AUGUST 2013
26/27 NOVEMBER 2013

TITLE OF PRESENTATION
FORWARD GUIDANCE
Duncan Gwyther
Chief Investment Officer

Client...
2013 - A GOOD YEAR FOR MANY RISK ASSETS
Returns YTD - 31/12/2012 to 21/11/2013
FTSE W US (€)

24.8

FTSE W Japan (€)

24.0...
2013 - EQUITY SECTOR PERFORMANCE

Source: DataStream, 21/11/13

FORWARD GUIDANCE

3
2014 - MODEST GLOBAL RECOVERY
•

•

•
•

•
•

Global growth
– US GDP to accelerate
– Japan policy momentum required to sus...
IMPROVING OUTLOOK FOR ECONOMIC GROWTH IN 2014
9
8
7
6

Real GDP %

5
4

2012
2013

3

2014

2
1
0
-1
-2
Euro

Ireland

UK
...
UK ACCELERATION RESULT OF CONSUMER AND CONSTRUCTION
Change in GDP Growth Estimates
April 13 vs October 13
3.0%
2.5%
2.0%
1...
US CYCLICAL UPTURN MODERATE BY HISTORIC STANDARDS

FORWARD GUIDANCE

7
US EMPLOYMENT IMPROVING - FED TO ADJUST TARGET?

FORWARD GUIDANCE

8
US BUDGET UNCERTAINTY REMAINS BUT FINANCES STRONGER

Political Timetable

US fiscal drag and deficit

• Committee to agree...
POSITIVE NEWSFLOW OVER SUMMER HAS EASED

FORWARD GUIDANCE

10
MANUFACTURING OUTLOOK IMPROVING IN MOST COUNTRIES

Source: Reuters, 50 = Expansion vs. Contraction Threshold, 20 November ...
GROWTH IN EXPORTS FROM ASIA REMAIN SUBDUED
Far East Exports

% change yoy

75

50

25

0

-25

-50
Jul-08

Jan-09

Jul-09
...
CHINA GROWTH REMAINS STRONG IN ABSOLUTE TERMS

FORWARD GUIDANCE

13
CHINA TO BRING LAND PRICES UNDER CONTROL

FORWARD GUIDANCE

14
IRELAND - UNEMPLOYMENT REMAINS HIGH
Unemployment - Ireland
500

450
400
Thousands

350
300
250

200
150
100
50
0

04

05

...
IRELAND - LOAN GROWTH TO HOUSEHOLDS CONTRACTING
Private Sector Loans - Ireland
35
30
25

20
%

15
10
5
0
-5

-10
04

05

0...
IRELAND - CONSUMER SENTIMENT IMPROVING
Consumer Sentiment - Ireland
120
110

100

Index Value

90
80
70
60
50

40
30
20
04...
INFLATION REMAINS LOW, DANGEROUSLY SO IN EUROZONE?
Consumer price inflation (%)

FORWARD GUIDANCE

18
US WILL BEGIN TO TAPER SOON
US Federal Reserve Balance Sheet – Cumulative Large Asset Purchases

Source: Federal Reserve B...
FORWARD GUIDANCE TO KEEP SHORT-RATES LOW

Source: Factset Deposit Rates, 20 November 2013

FORWARD GUIDANCE

20
SOVEREIGN DEBT MARKETS ANTICIPATING HIGHER RATES
NOW
(21 Nov 13)

- 1 MONTH
(21 Oct 13)

- 1 YEAR
(21 Nov 12)

Source: Blo...
INVESTMENT THEMES
• Increasing risk to obtain return
–
–

Structural challenges remain, but
Cyclical risks are abating as ...
SOVEREIGN BONDS ARE ANTICIPATING HIGHER RATES

FORWARD GUIDANCE

23
SOVEREIGN DEBT YIELDS REFLECT NOMINAL GROWTH

Source: DataStream, 20 November 2013

FORWARD GUIDANCE

24
CORPORATE BOND MARKET FUNDAMENTALS DETERIORATING
US corporate leverage versus spreads

Investment Grade debt maturities ($...
HIGH YIELD HAS SEEN RESURGENCE OF COV-LITE ISSUANCE
Increasing Proportion of Cov-Lite Loan Issuance

Source: Morgan Stanle...
INVESTMENT THEMES
• Increasing risk to obtain return
–
–

Structural challenges remain, but
Cyclical risks are abating as ...
EQUITY RETURNS IN 2013 MOSTLY DRIVEN BY P/E EXPANSION

Components of Equity Returns YTD
50
P/E Change
EPS Growth

Total Re...
VALUATIONS NO LONGER ‘CHEAP’

10Y Avrg

20Y Avrg

20Y Peak

US

14.2

16.5

19.8

UK

11.5

13.8

16.8

EUROPE EX UK

11.6...
EQUITIES - GLOBAL MARKET OUTLOOK
•

Global policy support and negative real interest rates
present profit opportunity

•

...
CYCLICAL RECOVERY - SECTOR VALUATION vs. EARNINGS
GROWTH

Source: Citi Research, EPS 31/10/13

FORWARD GUIDANCE

31
CYCLICAL RECOVERY - WHAT TO LOOK FOR WHEN INTEREST
RATES RISE
Factor Returns in GEMS During Periods of US Fed Tightening
5...
CYCLICAL RECOVERY - REGIONAL MARKET SENSITIVITY

Betas to Various Styles: Region vs. MSCI AC World
US

Europe

Japan

GEM
...
CYCLICAL RECOVERY - DM VS. EM, ASIA VS. LATAM

FORWARD GUIDANCE

34
US MANUFACTURING RENAISSANCE/ONSHORING

• Cheap energy

- Self sufficiency by 2030

- Gas prices one third of Europe’s

• ...
DEMOGRAPHICS
• Developing markets - improving living standards

• China

- Second largest economy in the world but 86th wh...
TECHNOLOGICAL SHIFT
• Kondratieff waves / super cycles

– Steam engine
– Railways
– Automobiles
– Information technology
–...
SELF-HELP RECONSTRUCTION

• Companies have cut costs through recession and built up cash balances

• Global economy recove...
STRONG FREE CASH FLOW FUNDS HIGHER DIVIDENDS
UK Industrial Sector - Free Cashflow Yield vs. Dividend Yield
% 9.0

8.0

7.0...
RISING PROFITS WILL SUPPORT STRONG DIVIDEND GROWTH
UK Industrial Sector - 3 Year Compound Dividend Growth vs. 2013 Yield
8...
STRUCTURAL REFORM - JAPAN
• Big bazooka – BoJ doubling size of balance
sheet in 2 years
• Targeting ‘sustainable’ 2% infla...
SENTIMENT - US MUTUAL FUND FLOWS

Source: Investment Company Institute, 06/11/13

FORWARD GUIDANCE

42
SENTIMENT - WALL STREET ‘FEAR GUAGE’ = COMPLACENT

FORWARD GUIDANCE

43
CURRENCY - US$ /£ MOVING ON RATE DIFFERENTIALS
UK / UK Interest Rate Differential vs. Exchange Rate

Source: Bloomberg, 20...
CURRENCY

ASSET ALLOCATION MEETING

45
STRATEGY - DECEMBER 2013
• Equities - overweight
– Growth expectations to improve 2014
– Central banks to continue reflati...
INTEREST RATE RISES ARE NOT ALL BAD FOR EQUITIES
115

Performance of S&P Post Federal Reserve Rate Rise

Federal Reserve
R...
DISCLAIMER
This presentation has been prepared only for investment professionals only. It is not intended for any other pe...
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2013 Nov 26 - Duncan Gwyther - Forward Guidance

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2013 Nov 26 - Duncan Gwyther - Forward Guidance

  1. 1. 15 AUGUST 2013 26/27 NOVEMBER 2013 TITLE OF PRESENTATION FORWARD GUIDANCE Duncan Gwyther Chief Investment Officer Client’s name Financial adviser’s name & company name FOR INVESTMENT PROFESSIONALS ONLY
  2. 2. 2013 - A GOOD YEAR FOR MANY RISK ASSETS Returns YTD - 31/12/2012 to 21/11/2013 FTSE W US (€) 24.8 FTSE W Japan (€) 24.0 FTSE W Europe ex UK 20.3 MSCI Frontier Markets 20.1 FTSE 100 (€) 14.4 FTSE W Asia Pacific ex Japan (€) 14.3 US $ to Euro € 3.9 FTSE W ex UK (€) 2.1 FTSE Index-Linked Gilts (€) 0.0 US $ to UK £ -0.5 Euro € to CHF -0.5 Euro € to UK £ -2.0 Eurofirst 300 -2.6 MSCI Emerging Markets (€) -2.8 Brent crude oil (€) -3.5 FTSE All Gilts (€) -5.1 CRB commodities Index (€) -11.0 Copper (€) -13.4 Gold (€) Percent % -25.6 -30 -20 -10 0 10 20 30 Source: DataStream, 21/11/13 FORWARD GUIDANCE 2
  3. 3. 2013 - EQUITY SECTOR PERFORMANCE Source: DataStream, 21/11/13 FORWARD GUIDANCE 3
  4. 4. 2014 - MODEST GLOBAL RECOVERY • • • • • • Global growth – US GDP to accelerate – Japan policy momentum required to sustain recovery – Europe emerging from recession slightly ahead of schedule – UK recovering faster than expected – China stabilising, EM mixed Monetary policy - low rates to continue – US QE tapering will happen in 2014 – Steeper yield curve anticipates first rate rises Inflation - to remain low – Global excess manufacturing capacity Fiscal sustainability and deleveraging – US progress – UK & peripheral Eurozone long way off Corporate earnings - strong upturn anticipated for 2014 Equity valuations fair FORWARD GUIDANCE 4
  5. 5. IMPROVING OUTLOOK FOR ECONOMIC GROWTH IN 2014 9 8 7 6 Real GDP % 5 4 2012 2013 3 2014 2 1 0 -1 -2 Euro Ireland UK Japan US GEMS China Global Source: Citi Research Global Economic Outlook & Strategy, 23 October 2013 FORWARD GUIDANCE 5
  6. 6. UK ACCELERATION RESULT OF CONSUMER AND CONSTRUCTION Change in GDP Growth Estimates April 13 vs October 13 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% -0.5% -1.0% -1.5% -2.0% UK Spain Germany Euro France DM Japan Global Mexico China US EM Ireland Russia India Brazil -2.5% Source: Citi Research Global Economic Outlook & Strategy, April 2013 and October 2013 FORWARD GUIDANCE 6
  7. 7. US CYCLICAL UPTURN MODERATE BY HISTORIC STANDARDS FORWARD GUIDANCE 7
  8. 8. US EMPLOYMENT IMPROVING - FED TO ADJUST TARGET? FORWARD GUIDANCE 8
  9. 9. US BUDGET UNCERTAINTY REMAINS BUT FINANCES STRONGER Political Timetable US fiscal drag and deficit • Committee to agree a budget by Dec 13th • Government funded until Jan 15th 2014 – next round of sequester cuts take effect • Debt ceiling suspended until Feb 7th 2014 Source: Barclays / Deutsche Bank, November 2013 FORWARD GUIDANCE 9
  10. 10. POSITIVE NEWSFLOW OVER SUMMER HAS EASED FORWARD GUIDANCE 10
  11. 11. MANUFACTURING OUTLOOK IMPROVING IN MOST COUNTRIES Source: Reuters, 50 = Expansion vs. Contraction Threshold, 20 November 2013 FORWARD GUIDANCE 11
  12. 12. GROWTH IN EXPORTS FROM ASIA REMAIN SUBDUED Far East Exports % change yoy 75 50 25 0 -25 -50 Jul-08 Jan-09 Jul-09 Jan-10 Taiwan export orders Jul-10 Jan-11 Jul-11 South Korea exports Jan-12 Jul-12 Chinese exports Jan-13 Jul-13 Indian exports Source: Reuters, 20 November 2013 FORWARD GUIDANCE 12
  13. 13. CHINA GROWTH REMAINS STRONG IN ABSOLUTE TERMS FORWARD GUIDANCE 13
  14. 14. CHINA TO BRING LAND PRICES UNDER CONTROL FORWARD GUIDANCE 14
  15. 15. IRELAND - UNEMPLOYMENT REMAINS HIGH Unemployment - Ireland 500 450 400 Thousands 350 300 250 200 150 100 50 0 04 05 06 07 08 09 10 11 12 13 Source: Reuters 21 November 2013 FORWARD GUIDANCE 15
  16. 16. IRELAND - LOAN GROWTH TO HOUSEHOLDS CONTRACTING Private Sector Loans - Ireland 35 30 25 20 % 15 10 5 0 -5 -10 04 05 06 07 08 09 10 11 12 13 Source: Reuters 21 November 2013 FORWARD GUIDANCE 16
  17. 17. IRELAND - CONSUMER SENTIMENT IMPROVING Consumer Sentiment - Ireland 120 110 100 Index Value 90 80 70 60 50 40 30 20 04 05 06 07 08 09 10 11 12 13 Source: Reuters 21 November 2013 FORWARD GUIDANCE 17
  18. 18. INFLATION REMAINS LOW, DANGEROUSLY SO IN EUROZONE? Consumer price inflation (%) FORWARD GUIDANCE 18
  19. 19. US WILL BEGIN TO TAPER SOON US Federal Reserve Balance Sheet – Cumulative Large Asset Purchases Source: Federal Reserve Board, Citi Research Global Economics 10 Sept 2013 FORWARD GUIDANCE 19
  20. 20. FORWARD GUIDANCE TO KEEP SHORT-RATES LOW Source: Factset Deposit Rates, 20 November 2013 FORWARD GUIDANCE 20
  21. 21. SOVEREIGN DEBT MARKETS ANTICIPATING HIGHER RATES NOW (21 Nov 13) - 1 MONTH (21 Oct 13) - 1 YEAR (21 Nov 12) Source: Bloomberg, 21 November 2013 FORWARD GUIDANCE 21
  22. 22. INVESTMENT THEMES • Increasing risk to obtain return – – Structural challenges remain, but Cyclical risks are abating as confidence improves and growth recovery broadens out • Another challenging year for bonds – – – – Trend in longer-dated issues remains up Returns on quality bonds more likely to be ‘dull’ than ‘dreadful’ Yield curve could flatten as economic growth improves = adverse impact on 3-7 year issues NB illiquid nature of some corporate bonds = diversification across issuers/regions could help • Equity themes – – – – – – – – Cyclical recovery through financials, autos, media, retailing and small/medium companies US ‘onshoring’ of manufacturing helped by cheaper energy Demographics in emerging markets = long-term trend remains intact Ageing developed world = healthcare, obesity Mergers and acquisitions Self-help reconstruction Strong free cash flow to fund higher dividends and share buybacks Structural reform FORWARD GUIDANCE 22
  23. 23. SOVEREIGN BONDS ARE ANTICIPATING HIGHER RATES FORWARD GUIDANCE 23
  24. 24. SOVEREIGN DEBT YIELDS REFLECT NOMINAL GROWTH Source: DataStream, 20 November 2013 FORWARD GUIDANCE 24
  25. 25. CORPORATE BOND MARKET FUNDAMENTALS DETERIORATING US corporate leverage versus spreads Investment Grade debt maturities ($bn) Source: Citigroup, November 2013 FORWARD GUIDANCE 25
  26. 26. HIGH YIELD HAS SEEN RESURGENCE OF COV-LITE ISSUANCE Increasing Proportion of Cov-Lite Loan Issuance Source: Morgan Stanley, 18 November 2013 FORWARD GUIDANCE 26
  27. 27. INVESTMENT THEMES • Increasing risk to obtain return – – Structural challenges remain, but Cyclical risks are abating as confidence improves and growth recovery broadens out • Another challenging year for bonds – – – – Trend in longer-dated issues remains up Returns on quality bonds more likely to be ‘dull’ than ‘dreadful’ Yield curve could flatten as economic growth improves = adverse impact on 3-7 year issues NB illiquid nature of some corporate bonds = diversification across issuers/regions could help • Equity themes – – – – – – – – Cyclical recovery through financials, autos, media, retailing and small/medium companies US ‘onshoring’ of manufacturing helped by cheaper energy Demographics in emerging markets = long-term trend remains intact Ageing developed world = healthcare, obesity Mergers and acquisitions Self-help reconstruction Strong free cash flow to fund higher dividends and share buybacks Structural reform FORWARD GUIDANCE 27
  28. 28. EQUITY RETURNS IN 2013 MOSTLY DRIVEN BY P/E EXPANSION Components of Equity Returns YTD 50 P/E Change EPS Growth Total Return YTD 40 Dividend Yield 30 20 10 0 -10 US Europe Japan EM Source: DataStream 20/11/13 FORWARD GUIDANCE 28
  29. 29. VALUATIONS NO LONGER ‘CHEAP’ 10Y Avrg 20Y Avrg 20Y Peak US 14.2 16.5 19.8 UK 11.5 13.8 16.8 EUROPE EX UK 11.6 14.0 19.0 JAPAN 15.4 24.3 56.2 ASIA 13.6 18.5 35.1 EM 11.3 12.0 21.2 DM 13.3 16.1 20.2 GLOBAL 13.0 15.7 19.7 Source: DataStream 18/11/13. 1 year vs. current forward P/E FORWARD GUIDANCE 29
  30. 30. EQUITIES - GLOBAL MARKET OUTLOOK • Global policy support and negative real interest rates present profit opportunity • Strong balance sheets, access to funding and cyclical exposure key drivers, but • Business confidence/earnings momentum still weak • Equities attractive on most valuation measures MSCI AW BMK WGT EPS YoY% 2013E 2014E Price/Earnings 2013E 2014E MSCI MSCI ROE Earnings Yield P/B Yield 2013E 2013E 2014E 10 yr Yield Eq Risk Premium UK 8.1% 0% 10% 13.5x 12.3x 1.8x 4.0% 15% 7.4% 8.1% 2.6% 4.8% US 51.7% 7% 11% 16.4x 14.8x 2.3x 2.2% 15% 6.1% 6.8% 2.7% 3.4% Europe ex UK 16.4% 7% 14% 15.3x 13.4x 1.6x 3.6% 12% 6.5% 7.5% 1.7% 4.9% Japan 7.7% 60% 20% 16.4x 13.7x 1.2x 2.1% 9% 6.1% 7.3% 0.6% 5.5% Pacific ex J 4.8% 2% 9% 15.9x 14.6x 1.7x 4.1% 11% 6.3% 6.8% 3.1% 3.2% Emerging 11.1% 10% 12% 11.8x 10.6x 1.4x 2.9% 13% 8.5% 9.4% 6.8% 1.7% Global 100.0% 9% 12% 15.2x 13.6x 1.8x 2.7% 13% 6.6% 7.4% Source: Citi GES, FactSet Consensus Estimates, MSCI, 9 November 2013 FORWARD GUIDANCE 30
  31. 31. CYCLICAL RECOVERY - SECTOR VALUATION vs. EARNINGS GROWTH Source: Citi Research, EPS 31/10/13 FORWARD GUIDANCE 31
  32. 32. CYCLICAL RECOVERY - WHAT TO LOOK FOR WHEN INTEREST RATES RISE Factor Returns in GEMS During Periods of US Fed Tightening 5 Information Ratio 4 June 99 - May 00 3 June 04 - June 06 2 1 0 -1 Book Yield Sales Yield Historic EPS Growth Cash Flow Yield Reported Net Margin Earnings Yield (12m Forward) Dividend Yield Reported ROE Earnings Yield (Trailing) Earnings Revisions Ratio -2 Source: Citi Group GEMS Strategy, 18 November 2013 FORWARD GUIDANCE 32
  33. 33. CYCLICAL RECOVERY - REGIONAL MARKET SENSITIVITY Betas to Various Styles: Region vs. MSCI AC World US Europe Japan GEM Asia x Japan Size 1.86 1.61 0.80 0.35 0.37 Price Momentum 0.24 -0.22 0.29 -0.63 -0.55 Estimates Momentum 0.05 -0.19 0.88 -0.31 -0.20 Risk -0.25 0.48 0.39 -0.04 -0.42 Growth 0.05 -0.38 -0.03 0.55 0.48 Value -0.29 0.42 0.01 0.40 0.33 Quality 0.21 -0.16 -0.62 -0.02 0.00 Source: CG, GEMS Strategy, 18 November 2013 FORWARD GUIDANCE 33
  34. 34. CYCLICAL RECOVERY - DM VS. EM, ASIA VS. LATAM FORWARD GUIDANCE 34
  35. 35. US MANUFACTURING RENAISSANCE/ONSHORING • Cheap energy - Self sufficiency by 2030 - Gas prices one third of Europe’s • Lower input and transportation costs - Cheaper manufacturing and distribution • Improving competitive advantage - 0% real wage growth v 15% p.a. in China • Reshoring - Jobs returning to the US Image Source: Company websites FORWARD GUIDANCE 35
  36. 36. DEMOGRAPHICS • Developing markets - improving living standards • China - Second largest economy in the world but 86th when measured by GDP per head ($6,000 v $50,000 in the US) • Incomes increasing - Doubling over 5 years • Everyday essentials - Trading up from low quality, generic items to branded goods • Aspirational purchasing - Premiumisation • Ageing population - saving for retirement, healthcare • Obesity - health & wellbeing Image Source: Company websites FORWARD GUIDANCE 36
  37. 37. TECHNOLOGICAL SHIFT • Kondratieff waves / super cycles – Steam engine – Railways – Automobiles – Information technology – ? • The rise of the innovators • Productivity enhancers Image Source: Company websites FORWARD GUIDANCE 37
  38. 38. SELF-HELP RECONSTRUCTION • Companies have cut costs through recession and built up cash balances • Global economy recovering. Tail risks receding • Are we about to enter a new M&A cycle? • Cheaper to buy than to build? • Balance sheet repair Image Source: Company websites FORWARD GUIDANCE 38
  39. 39. STRONG FREE CASH FLOW FUNDS HIGHER DIVIDENDS UK Industrial Sector - Free Cashflow Yield vs. Dividend Yield % 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Autos Media Telcos Comm Serv Fd & Bev Pharma Average 2012-14 FCF Yield Retailing Oil Materials Utils Average 2012-14 DY Source: Morgan Stanley, MSCI, IBES Consensus 6 Sept 2013 FORWARD GUIDANCE 39
  40. 40. RISING PROFITS WILL SUPPORT STRONG DIVIDEND GROWTH UK Industrial Sector - 3 Year Compound Dividend Growth vs. 2013 Yield 80 DY vs. 3Y Compound Average Growth Rate 70 60 50 40 30 20 10 0 Banks Media Fd & Bev Oil Autos Retailing Comm Serv Utils Telcos Pharma Materials REITS Ins Source: Morgan Stanley, MSCI, IBES Consensus 6 Sept 2013 FORWARD GUIDANCE 40
  41. 41. STRUCTURAL REFORM - JAPAN • Big bazooka – BoJ doubling size of balance sheet in 2 years • Targeting ‘sustainable’ 2% inflation • QE will include JGB’s, REITS and (equity?) ETF’s • Yen should continue to weaken • Economic activity should expand but watch reliance/cost of imported energy • LDP majority provides opportunity for structural reform • Equity themes: – Aging population – Exports – Reconstruction – Consumption pre tax hikes • Potential for improving ROE and re-rating • Equities very under-owned STRATEGY COMPENDIUM – Internal use only 41
  42. 42. SENTIMENT - US MUTUAL FUND FLOWS Source: Investment Company Institute, 06/11/13 FORWARD GUIDANCE 42
  43. 43. SENTIMENT - WALL STREET ‘FEAR GUAGE’ = COMPLACENT FORWARD GUIDANCE 43
  44. 44. CURRENCY - US$ /£ MOVING ON RATE DIFFERENTIALS UK / UK Interest Rate Differential vs. Exchange Rate Source: Bloomberg, 20 November 2013 FORWARD GUIDANCE 44
  45. 45. CURRENCY ASSET ALLOCATION MEETING 45
  46. 46. STRATEGY - DECEMBER 2013 • Equities - overweight – Growth expectations to improve 2014 – Central banks to continue reflation policies – Earnings should grow to support valuations – Absolute valuation ‘fair’ – Relative valuation attractive • Government bonds - underweight – Improving growth = higher yields – Risk to 2-7 year maturities from flatter curve? • Hedge funds – underweight – Risk profile increased but better opportunity elsewhere • Commercial property - overweight – Income attractions – Regional recovery anticipated • Cash - underweight FORWARD GUIDANCE 46
  47. 47. INTEREST RATE RISES ARE NOT ALL BAD FOR EQUITIES 115 Performance of S&P Post Federal Reserve Rate Rise Federal Reserve Rate Rise 110 105 100 95 1 6 11 16 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96 101 106 111 116 121 126 131 136 141 146 151 156 161 166 171 176 181 186 191 196 201 206 211 216 221 226 231 236 241 246 251 256 261 90 - 3 Months 31/01/1994 31/05/1999 31/05/2004 + 9 Months Source: Reuters, 20 November 2013 FORWARD GUIDANCE 47
  48. 48. DISCLAIMER This presentation has been prepared only for investment professionals only. It is not intended for any other persons and should not be relied upon by other persons. This presentation has been prepared for information purposes only and is not a solicitation or an offer to buy or sell any security. It does not purport to be a complete description of our investment policy, markets or any securities referred to in the material. The information on which the presentation is based is deemed to be reliable, but we have not independently verified such information and we do not guarantee its accuracy or completeness. All expressions of opinion are subject to change without notice. Any reference to the Quilter Cheviot Limited model portfolio, which is used for internal purposes, is purely illustrative and should not be relied upon. The figures quoted do not include charges. Investors should remember that the value of investments, and the income from them, can go down as well as up and that past performance is no guarantee of future return. You may not recover what you invest. Changes in exchange rates may have an adverse effect on the value, price or income of foreign currency denominated securities. Levels and bases of taxation can change. Investments or investment services referred to may not be suitable for all recipients. Quilter Cheviot Limited is a private limited company registered in England with number 01923571, registered office at One Kingsway, London WC2B 6AN. Quilter Cheviot Limited has established a branch in Dublin, Ireland with number 904906, is a member of the London Stock Exchange, is authorised and regulated by the UK Financial Conduct Authority and regulated by the Central Bank of Ireland for conduct of business rules. Accordingly, in some respects the regulatory system that applies will be different from that of the United Kingdom. FORWARD GUIDANCE 48
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