Maintaining a disciplined investment approach is essential for your long-term goals. Getty Images
Maintaining a disciplined investment approach is essential for your long-term goals. Getty Images
Maintaining a disciplined investment approach is essential for your long-term goals. Getty Images
Maintaining a disciplined investment approach is essential for your long-term goals. Getty Images

Four ways for investors to build portfolio resilience


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As we embrace the spirit of New Year’s resolutions, it's not just our personal goals that deserve a fresh perspective – our financial intentions and portfolios do, too.

This is an opportune moment for a comprehensive wealth check, ensuring that your strategic asset allocation remains aligned with your long-term goals and risk tolerance.

After an outstanding year for risk assets last year, investors can continue to build on this strength. While we anticipate continued market gains ahead, increased macroeconomic volatility underscores the importance of focusing on portfolio resilience to help safeguard your wealth and confidently navigate unexpected shocks.

Here are four actions worth considering:

1. Rebalance

You may not have fully grasped how the equity market gains in recent years may have tilted the balance between stocks and bonds in your portfolio. For example, if you were allocated to a 60/40 stock-bond portfolio in early 2020 and haven’t rebalanced since, your portfolio may have drifted to an 80/20 allocation.

Such allocations come with distinct risk profiles and return expectations, which may no longer align with your risk tolerance, potentially leading to a misalignment with your financial goals.

From a macroeconomic perspective, we think risks today are broadly balanced between recession and inflation, necessitating portfolios that are attuned to both risks. Within asset classes, rebalancing is also essential to maintain the right mix between sectors, factors, styles and regions.

2. Manage concentrated positions

Effectively managing concentrated positions is crucial for portfolio resilience.

Our research indicates that about half of all publicly traded companies experience a catastrophic loss in value (a 70 per cent peak-to-trough decline that is not recovered) and about two-thirds underperform the index.

Additionally, a significant concentrated cash position can act as a hidden obstacle to achieving your long-term goals and even erode purchasing power. While cash is necessary for one’s lifestyle, it’s important to remember that the current high yields on cash are not here to stay.

3. Lean into income

Increasing the share of total return driven by income can help bolster your portfolio’s resilience.

As yields on cash and Treasury bills decline, investors are increasingly on the lookout for new income sources.

Historical trends suggest that between $600 billion and $2.2 trillion of money market fund assets will move to find new homes.

Within the fixed-income arena, diversifying across various market subsectors, including high-quality sukuks and investment-grade bonds, may offer broader income sources.

Meanwhile, quality dividend-paying equities, currently trading at a discount relative to the market, tend to exhibit only 80 per cent of equity volatility.

Depending on one’s lifestyle needs, investing in direct lending, real estate debt, equity and infrastructures can provide additional ways to enhance income, though these may require a trade-off with liquidity.

4. Defend against inflation

Core fixed income remains a cornerstone of diversified investment portfolios. Yet, as inflationary pressures mount, assets like infrastructure can also help mitigate inflation risk while potentially strengthening portfolio resilience.

Over the past four years, traditionally diversified portfolios have faced challenges in maintaining their resilience, with stocks and bonds increasingly moving in tandem and showing a positive correlation.

Now more than ever, this shift underscores the importance of incorporating assets such as real estate, commodities and infrastructure, which have historically maintained low correlations with equities and fixed income.

Gold – the original safe-haven asset – can serve as a potential hedge against inflation, geopolitical risk and uncertainty around sovereign debt and deficits. We expect gold prices to find continued support from central banks, particularly in emerging markets.

Whatever the markets have in store, your wealth check and renewed portfolio resilience can give you confidence that your investment decisions align with your long-term goals.

While short-term market volatility may tempt reactionary responses, maintaining a disciplined investment approach grounded in robust fundamentals remains essential for your long-term goals.

Steven Rees is head of investments at JP Morgan Private Bank for Middle East, Africa & Turkey

Results

5pm: Al Maha Stables – Maiden (PA) Dh80,000 (Turf) 1,600m; Winner: Reem Baynounah, Fernando Jara (jockey), Mohamed Daggash (trainer)

5.30pm: Wathba Stallions Cup – Maiden (PA) Dh70,000 (T) 1,600m; Winner: AF Afham, Tadhg O’Shea, Ernst Oertel

6pm: Emirates Fillies Classic – Prestige (PA) Dh100,000 (T) 1,600m; Winner: Ghallieah, Sebastien Martino, Jean-Claude Pecout

6.30pm: Emirates Colts Classic – Prestige (PA) Dh100,000 (T) 1,600m; Winner: Yas Xmnsor, Saif Al Balushi, Khalifa Al Neyadi

7pm: The President’s Cup – Group 1 (PA) Dh2,500,000 (T) 2,200m; Winner: Somoud, Adrie de Vries, Jean de Roualle

7.30pm: The President’s Cup – Listed (TB) Dh380,000 (T) 1,400m; Winner: Haqeeqy, Dane O’Neill, John Hyde.

SPEC%20SHEET%3A%20APPLE%20IPHONE%2015%20PRO%20MAX
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The biog

Name: Younis Al Balooshi

Nationality: Emirati

Education: Doctorate degree in forensic medicine at the University of Bonn

Hobbies: Drawing and reading books about graphic design

HEADLINE HERE
  • I would recommend writing out the text in the body 
  • And then copy into this box
  • It can be as long as you link
  • But I recommend you use the bullet point function (see red square)
  • Or try to keep the word count down
  • Be wary of other embeds lengthy fact boxes could crash into 
  • That's about it
Diriyah%20project%20at%20a%20glance
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Film: Raid
Dir: Rajkumar Gupta
Starring: Ajay Devgn, Ileana D'cruz and Saurabh Shukla

Verdict:  Three stars 

Find the right policy for you

Don’t wait until the week you fly to sign up for insurance – get it when you book your trip. Insurance covers you for cancellation and anything else that can go wrong before you leave.

Some insurers, such as World Nomads, allow you to book once you are travelling – but, as Mr Mohammed found out, pre-existing medical conditions are not covered.

Check your credit card before booking insurance to see if you have any travel insurance as a benefit – most UAE banks, such as Emirates NBD, First Abu Dhabi Bank and Abu Dhabi Islamic Bank, have cards that throw in insurance as part of their package. But read the fine print – they may only cover emergencies while you’re travelling, not cancellation before a trip.

Pre-existing medical conditions such as a heart condition, diabetes, epilepsy and even asthma may not be included as standard. Again, check the terms, exclusions and limitations of any insurance carefully.

If you want trip cancellation or curtailment, baggage loss or delay covered, you may need a higher-grade plan, says Ambareen Musa of Souqalmal.com. Decide how much coverage you need for emergency medical expenses or personal liability. Premium insurance packages give up to $1 million (Dh3.7m) in each category, Ms Musa adds.

Don’t wait for days to call your insurer if you need to make a claim. You may be required to notify them within 72 hours. Gather together all receipts, emails and reports to prove that you paid for something, that you didn’t use it and that you did not get reimbursed.

Finally, consider optional extras you may need, says Sarah Pickford of Travel Counsellors, such as a winter sports holiday. Also ensure all individuals can travel independently on that cover, she adds. And remember: “Cheap isn’t necessarily best.”

Common%20symptoms%20of%20MS
%3Cul%3E%0A%3Cli%3EFatigue%3C%2Fli%3E%0A%3Cli%3Enumbness%20and%20tingling%3C%2Fli%3E%0A%3Cli%3ELoss%20of%20balance%20and%20dizziness%3C%2Fli%3E%0A%3Cli%3EStiffness%20or%20spasms%3C%2Fli%3E%0A%3Cli%3ETremor%3C%2Fli%3E%0A%3Cli%3EPain%3C%2Fli%3E%0A%3Cli%3EBladder%20problems%3C%2Fli%3E%0A%3Cli%3EBowel%20trouble%3C%2Fli%3E%0A%3Cli%3EVision%20problems%3C%2Fli%3E%0A%3Cli%3EProblems%20with%20memory%20and%20thinking%3C%2Fli%3E%0A%3C%2Ful%3E%0A
Muslim Council of Elders condemns terrorism on religious sites

The Muslim Council of Elders has strongly condemned the criminal attacks on religious sites in Britain.

It firmly rejected “acts of terrorism, which constitute a flagrant violation of the sanctity of houses of worship”.

“Attacking places of worship is a form of terrorism and extremism that threatens peace and stability within societies,” it said.

The council also warned against the rise of hate speech, racism, extremism and Islamophobia. It urged the international community to join efforts to promote tolerance and peaceful coexistence.

COMPANY PROFILE
Name: Kumulus Water
 
Started: 2021
 
Founders: Iheb Triki and Mohamed Ali Abid
 
Based: Tunisia 
 
Sector: Water technology 
 
Number of staff: 22 
 
Investment raised: $4 million 
Company%20Profile
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UAE squad

Esha Oza (captain), Al Maseera Jahangir, Emily Thomas, Heena Hotchandani, Indhuja Nandakumar, Katie Thompson, Lavanya Keny, Mehak Thakur, Michelle Botha, Rinitha Rajith, Samaira Dharnidharka, Siya Gokhale, Sashikala Silva, Suraksha Kotte, Theertha Satish (wicketkeeper) Udeni Kuruppuarachchige, Vaishnave Mahesh.

UAE tour of Zimbabwe

All matches in Bulawayo
Friday, Sept 26 – First ODI
Sunday, Sept 28 – Second ODI
Tuesday, Sept 30 – Third ODI
Thursday, Oct 2 – Fourth ODI
Sunday, Oct 5 – First T20I
Monday, Oct 6 – Second T20I

'Worse than a prison sentence'

Marie Byrne, a counsellor who volunteers at the UAE government's mental health crisis helpline, said the ordeal the crew had been through would take time to overcome.

“It was worse than a prison sentence, where at least someone can deal with a set amount of time incarcerated," she said.

“They were living in perpetual mystery as to how their futures would pan out, and what that would be.

“Because of coronavirus, the world is very different now to the one they left, that will also have an impact.

“It will not fully register until they are on dry land. Some have not seen their young children grow up while others will have to rebuild relationships.

“It will be a challenge mentally, and to find other work to support their families as they have been out of circulation for so long. Hopefully they will get the care they need when they get home.”

UAE currency: the story behind the money in your pockets
Our family matters legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

Defending champions

World Series: South Africa
Women’s World Series: Australia
Gulf Men’s League: Dubai Exiles
Gulf Men’s Social: Mediclinic Barrelhouse Warriors
Gulf Vets: Jebel Ali Dragons Veterans
Gulf Women: Dubai Sports City Eagles
Gulf Under 19: British School Al Khubairat
Gulf Under 19 Girls: Dubai Exiles
UAE National Schools: Al Safa School
International Invitational: Speranza 22
International Vets: Joining Jack

Updated: January 29, 2025, 4:00 AM`