Onuekwusi said the market environment looks relatively stable for the next 18 months with decent levels of growth and low inflation, but a potential Chinese slowdown, central banks raising rates too quickly and the growth of populism could stunt the market’s upward trajectory.
Onuekwusi said: “First is the possibility of a Chinese slowdown. The big question here is not if, but exactly when it will happen, and at what magnitude.
“The second risk is central banks raising rates more quickly than the market expected, which could be undesirable for multi-asset investors as it leads not only to a bond sell off, but also to an equity sell off.
“The third risk we cannot ignore is the shift away from traditional politics towards more populist ideals.”
As a result, he said LGIM’s asset allocation team is closely monitoring these potential events and has positioned its Multi-Index portfolios accordingly.
This comes as LGIM’s Multi-Index fund range, launched in 2013, surpasses £2bn in assets under management.
Onuekwusi added: “We are delighted to have reached this milestone across the Multi-Index funds, having opened the range just four years ago.”
On Wednesday, LGIM also launched a Real Capital Builder (RCB) fund in a bid to beat rising inflation.
