This page is not available in your selected language. Your language preference will not be changed but the contents of this page will be shown in English.

To change your current location please select from one of Julius Baer’s locations below. Alternatively if your location is not listed please select international.


Please select
Additional e-Services

*The location identified is an approximation based on your IP address and does not necessarily correspond to your citizenship or place of domicile.


Sign up for Insights newsletter


Sign up for Insights newsletter

From BRICs to FANGs to TINA to TARA – What’s next?

The sell-off in US equities has concluded its seventh week, and the mood of capitulation is spreading. ‘No place to hide’ is the mantra, as the major asset classes have posted negative returns in unison year-to-date.




Wall Street is revisiting its recent poster child ‘There Is No Alternative’ (TINA) to equities. A US prime broker suggests TARA (‘There Are Reasonable Alternatives’) after even solid fixed income assets are showing positive yields again. As with other acronyms such as BRICs (Brazil, Russia, India, China) or FANGs (Facebook, Amazon, Netflix, Google), I doubt that the revised versions will have a long shelf life. Yet it shows the hunger for something new in terms of investment narrative. What will it be? History suggests two things: 1) the next investment mantra is already here, but 2) you will only know it when you see it.

In the meantime, investors are caught in the usual dilemma: whether it pays to go against the grain. To be fair, we do not claim to get the timing right. If we feed the models with market expectations, a recession is almost certain. If we feed the models with what is currently priced in, the odds are more moderate. To balance the two, you may want to look for exhaustion: a risk reversal would most likely be signalled by a USD sell-off and a broad-based buying thrust in equities.

Conclusion for investors

Before these signals materialise, we will continue to do the groundwork and assess the latest developments. We have downgraded Chinese sovereign bonds due to fears of capital outflows. The zero-Covid-19 policy, the clean-up of the property market, and geopolitical risks may make investors shy away further. Looking at the recent sell-off in US retail stocks, we do not see this as a buying opportunity either. Some of the problems seem to be more structural, as the discounters face major margin headwinds. This by no means implies that this is a problem for all corporate America. Rather, we look for shelter elsewhere, e.g. in the healthcare space. As for our Next Generation franchise: we continue to focus on profitable companies instead of loss-making, hopeful ones.

Number of the week

How should you position your portfolio in the view of Julius Baer's experts?

> Contact us to find out