Most Read Contributor in British Virgin Islands, March 2017
During a recent visit to our London office, I had the privilege
of attending AIMA's Spotlight and Cocktail reception in London,
the highlight of which for me was a keynote speech by Robert Peston. For those of you who were
not in the UK in 2008 and 2009, Robert was one of the most
prevalent economic commentators at the time (and, personally, a bit
of a hero of mine).
The theme of Robert's presentation was uncertainty and the
question he asked us all to consider was whether, if 2007 was the
age of absolute certainty (albeit, certainty that we were all about
to suffer a painful and prolonged recessionary period), 2016 is the
age of absolute uncertainty, politically and economically?
As Robert went on to describe, in his 30 years of political and
economic reporting, he had never before experienced a period of
such instability; Brexit and the potential contagion to other EU
Member States, Trump vs. Clinton and the consequences for the US
economy, and China's growing bad debt, to name but just a
handful of the global issues we currently face.
And whilst he acknowledged that for most people this would be
terrible news, speaking to a room full of fund managers, he
wondered whether this might actually be construed as a positive.
After all, uncertainty boosts volatility and drives down valuation
multiples. As the Financial Times said back in May, markets move in advance of full clarity. The
more certain the picture becomes, "the more markets can
focus on likely outcomes and start discounting them".
The managers I frequently speak with certainly see it that way,
and the message we are hearing loud and clear in the BVI is that
now is the precisely the right time to test a new strategy. Perhaps
this is the reason our BVI funds team has never been busier
fielding enquiries about our new incubator fund product, a fund whose
sole purpose is designed to allow managers to test a strategy and
establish a track record. The early (and innovative) bird catches
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Now that the United Kingdom has served notice to leave the European Union under Article 50 of the Lisbon Treaty, managers of offshore funds have a clearer timetable for when Brexit will happen, with the UK scheduled to leave the EU in March 2019.
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