With the current political climate, it's important to know the risks and scenarios that could play out from different geopolitical topics. From trade disputes to military conflict, there are many ways that geopolitical unrest can impact the economy and the market.
In this episode, Rusty talks with Kim Arthur, President and CEO at Main Management. Kim began his financial career in 1987 when he joined Montgomery Securities in their Institutional Sales division. In 2009, he was recognized by Institutional Investor Magazine as a "Rising Star" of Foundations and Endowments. Kim has also been profiled in Index Universe articles and referenced in Barron's, Wall Street Journal, Business Week, and Fortune Magazine, among others.
Kim talks with Rusty about some potential risks and scenarios from different geopolitical topics that are top of mind for many financial advisors and investors and the impact geopolitical turbulence might have on the economy and the market.
Key Takeaways
[03:21] - Kim's career history and key role at Main Management.
[07:12] - Why investors should consider geopolitical risk in their portfolios.
[08:48] - The impact of the Russian-Ukrainian conflict on the market.
[12:06] - Kim's perspective on investing in China.
[16:08] - How Main Management views the U.K. from an investment perspective.
[18:07] - What Kim thinks about deglobalization.
[23:07] - The good, the bad, and the ugly of the rising dollar.
[26:10] - Other geopolitical risks investors should be aware of.
[30:14] - Kim's rationale for deglobalization.
[34:30] - What the market looks like during actual hostilities.
[41:10] - Other risks investors should consider in this current environment.
[46:09] - An equity fund inflows and outflows analysis.
Quotes
[07:29] - "The two things that have to be considered with geopolitical risk are once you go outside of your home country, you are exposing yourself to currency risk. If it's a tailwind, that can be very nice, but if it's a headwind like it's been for the last 11 years, it can be very painful. Then the political and conflict aspect. Many countries don't play by the same rules you and I play in the U.S." ~ Kim Arthur
[24:26] - "There have been huge flows from overseas into the U.S. dollar because of the safe haven of this country that we are in. The good is it's cheaper to import things. The bad is that the high dollar is a huge currency headwind. The ugly is when you have the dollar's strength, emerging currencies blow up big time." ~ Kim Arthur
[41:34] - "Risk, by definition, exposes you to danger, harm, or loss. None of those sounds good. But you can reduce all of those if you take calculated risk-taking." ~ Kim Arthur
Links
Kim Arthur on LinkedIn
Main Management
Main Management on Twitter
Orion Risk Intelligence
Sweet Child O' Mine by Guns N' Roses
Montgomery Securities
Goldman Sachs
Connect with our hosts
Rusty Vanneman
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Disclosure
Access to the services presented is provided solely as a service to financial advisors. Orion Risk Intelligence does not make recommendations or determine the suitability of any security or strategy. The past performance of a security or strategy does not guarantee future results. Orion Risk Intelligence research and tools are provided for informational purposes only. While the information is deemed reliable, Orion Risk Intelligence does not guarantee its accuracy, completeness, or suitability for any purpose and makes no warranties with respect to the results to be obtained from its use.
2168-OPS-11/10/2022
