insights.

Eurozone economic growth has slowed this year but is still broad-based, with all countries participating in the upturn, and firmly above potential. Lesser external demand accounts for much of the slowdown – the Eurozone being more open than most other large advanced economies.

In this article, we look at the economic situation in China, the state of relations between the world’s two largest economies and the implications for investors exposed to the yuan and emerging currencies.

Too much negativity seems to be priced-in. Based on our central scenario of a slowdown with no major global downturn and lower US real yields as inflation picks up, the hefty misalignments in some commodity FX with underlying fundamentals offer attractive opportunities.

Strong growth momentum, ongoing fiscal support, a tight labour market and mounting inflationary pressures all suggest that the Fed will deliver on its plan to further tighten monetary policy over the next few quarters. While a number of risks are worth monitoring, the determinant factors for US monetary policy will remain domestic inflation and employment.

For too long most professional investors operated on the basis that it really did not matter if the businesses they backed damaged the environment, or our health or our living standards. So-called externalities were the business of government to sort out. Investors’ responsibility was simply to evaluate whether shares were good or bad value on the basis of whatever financial metric they preferred or was fashionable. But the rise of populism, and the associated life-or-death challenge to economic liberalism, means that the prudent investor can no longer sit on the sidelines and ignore the benign and toxic spinoffs from corporate conduct. Sustainable investing means harnessing the power of capital to foster a sustainable society.

What will the children of today - the investors of tomorrow - want from their investments? The answer - an awful lot. The next generation look like they will be more socially and environmentally engaged than the last few. They know they are stakeholders in the future of the world rather than just shareholders in the world’s listed companies. So, while they are sure to still want to make financial returns from their cash, they are also likely to want to see good come from the way in which their money is invested. What kind of good? The answer to that is going to be different for every investor. That’s why the future of investment is a collaborative one. If the financial services industry wants to serve the next generation properly, it must spend less time assuming it knows what the young want and more time asking them what they want

It is the starkest warning of recent history. The world needs to make "rapid, far-reaching and unprecedented changes in all aspects of society" over the next decade in order to keep climate change at bay and limit the threat of a raft of natural disasters affecting millions of people.

The Family Business Network (FBN) and Lombard Odier have rewarded three exceptionally promising young family business entrepreneurs as finalists in the 10th FBN NxG Lombard Odier Award. The finalists had the opportunity to pitch their projects to over 500 family business leaders at the FBN 29th Global Summit in Venice on 12th October, where the overall winner was revealed.

Our central scenario does not foresee a major downturn over the next year or so, only some deceleration in world economic growth. The balance of risks is nonetheless becoming less favourable, owing to tighter US monetary policy and the escalating trade dispute between the two economic powerhouses. A progressive reduction of portfolio risk is thus warranted, towards a more neutral positioning.

The next economic revolution is already underway. The most fundamental shift in the history of humanity. And this revolution bears the name sustainability. It’s more than just an environmental issue.

Tech is transforming the face of philanthropy younger, faster, higher impact.They are digital natives, and want engagement – volunteering time for fundraising, crowdfunding or fieldwork – plus storytelling of causes that should be tweetable and repeatable.

Brent crude oil is trading close to a four-year high, at USD 84¹ per barrel, while commodity markets are more widely experiencing their longest losing streak in more than three years. This dispersion between commodity returns is wide and needs investors’ attention in portfolios in a strong dollar environment and rising US interest rates. While crude oil has gained more than 26% since the start of 2018, the broad Bloomberg Commodity Index has fallen around 1% over the same period. In this article, we look at the supply and demand dynamics on the oil market, the impact on inflation and the implications for investors in three market scenarios.

Discover our latest investment insights from Stéphane Monier, CIO Private Bank, and Samy Chaar, Chief Economist, in our quarterly investment strategy video.

Every year, France Digitale unites investors and startups in Paris to discuss the latest digital trends and future innovations. An annual event to delve deep into the digital world and sustainable innovation.

My LO puts Lombard Odier’s cutting-edge, in-house technology into your hands, in a user-friendly platform developed alongside our clients and our bankers. My LO, a simple and secure platform for monitoring your wealth.

From the depths of the ocean to in-depth cancer research, Lombard Odier’s philanthropic partners shared experiences and vision at the tenth anniversary celebration of Fondation Philanthropia.

Sustainability issues were once seen as irrelevant to companies and investors, an inconvenience incompatible with the business of making money, except for a few 'responsible' investors who were happy to accept lower returns in order to 'do the right thing'.

The 10th anniversary of Fondation Philanthropia raises the benefit of ‘sheltered funds’: a modern concept that favours collaborative, innovative and enlightened generosity and that increases the impact of each donation tenfold. They are democratizing access to philanthropy.

Central bank policies since the 2008 financial crisis have fuelled the longest bull run in history and created the conditions for an era of stable economic growth. Interest rates were kept low and quantitative easing (QE) ensured a flow of money into the system. That gave us reassuringly steady investment returns, while debt-to-GDP ratios rose across the world.

Tech startups are well known for their capacity to disrupt entire markets by addressing some of their flaws, inefficiencies or failures. In some cases, these market inefficiencies have huge consequences on the capacity of citizen to access the most basic services, or generate decent revenues for them and their families.

Article published in L’Agefi, September 3, 2018, by Laurent Pellet

The new Financial Institutions Act (FinIA), which is in the process of being passed by the Swiss parliament, recognises External Asset Managers (EAMs) as a genuine profession. What impact will this regulation have on the bank’s activities in this area?

Article published in Allnews, September 18, 2018, By Stéphane Monier

Private clients’ investment needs are changing as a result of legislation, regulations and the reorganisation of private banking, as well as a new, more responsible approach adopted by a growing proportion of clients.

Article published in 24 heures, September 19, 2018 , by Samy Chaar

Samy Chaar, Chief Economist of Banque Lombard Odier & Cie, gives his analysis of the trade negotiations with the EU. It is likely that Switzerland will have to bend to the will of its principal economic partner in trade negotiations with the European Union.

The global move toward sustainability — and tackling challenges such as climate change, inequality and demographic shift — continues apace but there is a marked contrast in approach from the world's superpowers.

The next economic revolution is already underway, which we believe could be the biggest driver of investment returns in the next three years and beyond.

Brazil’s voters go to the polls for the first round of general elections on 7 October in a race closely watched by investors looking for signs of fiscal improvement. High on the priority list for the eventual winner is the urgent need for pension reform to limit the country’s debt, which we consider an important risk in Brazil.

Article published in NZZ , September 13,  2018

Digitalization will make private banking even more personal and tailored. Thanks to their agile structures as well as their resource and financial strength, private banks have a decisive competitive advantage.

The Federal Reserve's tightening process is well under way – and well ahead of other major central banks. Despite the tightening steps already taken, and a well advanced economic cycle, signs of slowdown in the US economy are still mostly absent.

Article published in Le Temps, September 9, 2018

It can be hard, sometimes, to block out the noise and focus on what really matters. But, when it comes to emerging markets, this can be an incredibly useful skill for investors looking for attractive long-term opportunities.

Italy’s populist politics are again destabilising the Eurozone as the country’s new government prepares a domestic budget and threatens to withhold its payments to the European Union, undermining investor confidence.

Article published in Finanz und Wirtschaft, August 28, 2018, by Monica Hegglin

As an investment bank, Lombard Odier impressed Jules Verne. When the foundations were laid for the private bank in 1796, Geneva was not yet a part of Switzerland. Asset management came along much later.

Operating income up 10% with net profit up 16%

Five years ago, emerging markets set off on a rocky road as the so-called "taper tantrum" rattled investors. Fast forward to 2018, and the US is firmly in tightening mode, the dollar (USD) is strong, US rates are on the up, and emerging markets are feeling the pinch once again.

Article published in Islamic Business & Finance, August 16, 2018

Lombard Odier has launched of a Shari'ah-compliant discretionary mandate, the first in its 222-year history. The exclusive discretionary mandate has been officially certified as Shari'ah compliant by the eminent Shari'ah Supervisory Board of Amanie Advisors, who issued a Fatwa in February.

Insight in French
La planification successorale pour une entreprise familiale régie par le droit suisse est un processus continu et complexe. Quelles sont les étapes et les instruments juridiques à disposition pour une planification successorale réussie ? Entretien avec Marie-Christine Von Pezold, Head of Lombard Odier Family Programme.

Lombard Odier Group’s newest Managing Partner has embraced the “Rethink Everything” mantra. Our interview with Annika Falkengren looks at why she joined the bank, lessons from the financial crisis… and the trouble with Freddie.

Investment experts have often sceptically dismissed cryptocurrencies as excessively volatile. Technologists have described them as revolutionary. Who is correct? Will cryptocurrencies become a mainstream asset class?

The world of philanthropy is changing. As global challenges loom in health, the environment and sustainable development, wealthy donors are increasingly acting as catalysts for projects that that can deliver a far greater impact than we have seen before. Three questions to Denis Pittet, Managing Partner of the Lombard Odier Group and Chairman of Fondation Philanthropia.

Technology and globalisation, paired with a hunger for impact, are fundamentally reshaping how philanthropists can support art and culture.

Just over two years ago economists warned of a “Brexit shock” to the UK when the British voted to leave the European Union (EU). Investors and companies were expected to shun a country that had decided to leave the world’s largest trading bloc, dealing a damaging blow to the economy. In reality, the aftermath is turning into a slow economic asphyxiation. 

The world of virtual reality (VR) is seeping into the mainstream. And it's not only adolescent gamers who will reap the benefits.

When Steve Jobs unveiled the "revolutionary and magical” iPhone in 2007, it seemed reasonable to suppose that smart mobile devices would not only change the way we interact, but help us to do more with our time. In fact, measures of productivity growth across many developed economies have halved, or worse, in the decade since the arrival of the iPhone. Why did productivity growth shrink and why should investors care? 

With the soft patch experienced by non-US economies now likely over, fundamentals should run strong, underpinning our pro-growth stance. Rising political uncertainty nonetheless warrants adjustments in active portfolio risk and a continued search for asymmetric trade opportunities.

The global environment is not conducive for emerging markets to thrive, but the countries most affected to date have been those with the weakest fundamentals or highest political risk.

In Japan, the steady uptrend in wages and rebound in activity will ease concerns surrounding negative 1st quarter GDP growth; despite its dovish talk, the Bank of Japan is engaged in a “silent tapering”. 

Some of the predictions for how working life will change in the 21st century are stark. That has sparked much hand-wringing about how humans will adapt, how economies will evolve, and how investors might benefit.

The Eurozone economy has taken a breather, but the softness recorded year-to-date does not herald a sustained downturn and the central bank has committed to remaining accommodative for longer. 

Leading indicators are not pointing to a US recession anytime soon – particularly since the Federal Reserve has no reason to speed-up its policy tightening.

We continue to assume that trade tensions will remain contained but must recognise that the prospect of a trade war has become a risk warranting serious consideration.

Article published in NZZ am Sonntag, July 8, 2018
By Annika Falkengren, Managing Partner, Lombard Odier Group