Should investors fear no assets can protect them from increased turbulence in global markets amid November’s looming U.S. election and persistent worries around the COVID-19 pandemic?
That’s the concern addressed by JP Morgan strategists who warned that many traditional haven investments in September have not performed as advertised, providing scant shelter as global equities came under steady, but incessant pressure over the past few weeks.
“For those looking for hedge protection, this typical basket of defensives is functioning about as well as fire insurance that covers just one bedroom in the house,” said a JPMorgan team of analysts led by John Normand, in a note Friday.
By their estimation, the performance of haven assets this month has been the worst in more than 10 years, when looking at periods with more than a 5% decline of the MSCI All Country World Index
a widely used composite