Raiffeisen-Dynamic-Assets (I)

Fund Management Report

The new Omicron variant brought elevated volatility on the capital markets over the past weeks, but the international equity markets were listing close to their highs for the year at the same time. Despite the continued very high inflation rates, the high-quality bond markets were firmer. The fund reduced its initially high equity exposure to a moderate level in December. Significant capital was reallocated to government bonds, both nominal and inflation-linked issues. This broad approach allowed the fund to profit from the positive development posted by all asset classes in the portfolio until the middle of the month. Attention is still focused on the central banks. The US Fed announced the termination of its bond purchase programme in March 2022 and interest rate hikes in the near future. Thanks to successful communication in advance, the markets are already prepared for this. Whether the ECB has similar success today (16 December) and how the markets will react will be interesting to see. The Omicron variant is not yet being priced in as the most significant risk, but is also causing volatility. (16.12.2021)