Inflation, rising rates, and market volatility

Navigating the perfect storm with real assets

May 11, 2022 | 9 min read

Seema Shah

Chief Global Strategist

Inflation is the single biggest challenge that investors face today. The sudden and sustained jump in prices has inflicted a considerable shock to the economic system, sharply pushing up interest rates, while challenging corporations and equity markets. For individuals, inflation quietly erodes the purchasing power of savings and cash, a significant problem, regardless of time horizon. For institutional investors, higher-than-expected inflation reduces real returns and makes it difficult to generate long-term forecasts to meet objectives. In all cases, however, inflation—and the threat of persistent inflation that’s higher than expected—is a reason to reconsider the traditional asset allocations that only address market environments of the past.

Inflation has reached four-decade highs

Many factors have driven inflation over the past two years, with the industry spilling plenty of ink over the topic. In short, the rapid economic recovery from the pandemic, surging consumer demand, excessive government stimulus and ongoing supply chain disruptions have caught many economists off guard. More recently, geopolitics have played an important role: The Russian invasion of Ukraine has pushed food and energy prices higher, directly affecting consumer pocketbooks.

To make matters worse, after falling desperately behind the inflation curve, the United States Federal Reserve (Fed) has finally recognized the urgent need to tighten policy.

Recall that after the global financial crisis, stubbornly low inflation meant that the Fed’s dual mandate of price stability and maximum employment was effectively a single mandate. The Fed could focus on keeping employment high without worrying about an overheating economy—and they extended this approach even after the pandemic with rates staying near-zero and monetary stimulus ballooning the Fed’s balance sheet to $9 trillion. This erroneously patient approach has permitted price pressures to multiply, broaden, and intensify unhindered, pushing inflation up to a 40-year high.

Although inflation may have recently peaked, it is unlikely to subside rapidly. If higher prices, which have now broadened, are allowed to persist, they can become sticky. As experienced during the 1970s and early 1980s, a wageprice spiral, where rising wages beget rising prices, which cause further pressure on wages, certainly could allow inflation to be a challenge for longer than expected.

Perhaps the silver lining is that the economy is still fundamentally strong despite these challenges. After all, inflation is a problem created partially by robust consumer and business demand. Yet, while a Volcker-era wage-price spiral isn’t the base-case, the economy can only stay strong for so long in the face of declining household purchasing power and rising interest rates. So, while the economy is on decent footing today, the risk of recession is likely to increase meaningfully in late-2023 and into early-2024.

Consumer price index (CPI)
CPI and ex-Food and Energy, YoY % change

Line graph showing the Consumer Price Index year over year percentage change from 1960 to 2020

Clearnomics, Bureau of Labor Statistics, Principal Global Investors. Forecasts are Principal Global Asset Allocation forecasts. Data as of May 11, 2022.

Traditional assets solve yesterday’s problems

The first real inflation shock in four decades means that many portfolios may not be properly positioned. In general, traditional asset classes aren’t ideally suited for high or rapidly rising inflation scenarios. This is especially true as interest rates increase in response.

Already in 2022, the 10-year U.S. Treasury yield crossed the 3% threshold, a sharp increase from 1.5% at the start of the year and 0.9% at the start of 2021. With the Fed beginning to raise policy rates aggressively and quantitative tightening now underway, there are reasons to believe that rates will remain elevated, with bond yields ending the year around 2.5%.

Fed funds futures implied rates
Implied fed funds rates and number of hikes/cuts at each Fed meeting

Bar chart showing implied Fed funds rates and number of hikes/cuts at each Fed meeting from June 15, 2022, to February 1, 2023

Clearnomics, Bloomberg, Principal Global Investors. Data as of May 4, 2022.

Today's environment creates the perfect storm against fixed income. Bonds, by definition, are susceptible to rapidly rising nominal rates. The devastating combination of red-hot inflation and easy monetary policy has meant that real yields have been negative. Now, with policy rates moving sharply higher and inflation pressures receding very gradually, bonds will not only be susceptible to rising nominal yields, but also to real yields moving back into positive territory.

As a result, the bond market has faced its toughest period since 1980, with the Bloomberg U.S. Aggregate Index declining 9.5% year-to-date.¹ (For reference, in early 1994, after the Fed surprised the market with rate hikes, the bond market had a 6.6% peak-to-trough decline.)

Equities haven't been immune to the ravages of inflation either. The S&P 500 has dropped over 15%, year-to-date as investors have realized that high inflation can be problematic for the asset class. While stocks can perform well when inflation is moderate and rising steadily, since companies with pricing power can often pass on higher costs to their customer's, pricing power has its limits.

Higher prices will eventually dampen consumer and business spending while also raising costs. Profit margins will be under increasing pressure this year, weighing on earnings growth. For financial markets, higher discount rates reduce the value of future cash flows today, depressing asset prices.

Thus, after decades of dormant inflation and falling interest rates, investors now need better ways to diversify portfolios and to enhance real returns. In today’s environment, this may require looking beyond the public market stocks and bonds that have been the main portfolio building blocks over the last 40 years.

Real interest rates
10-year real inflation adjusted interest rate based on TIPS

Line graph showing the 10 year real inflation adjusted interest rate based on TIPS from 2010 to 2022

Clearnomics, United States Treasury, Principal Global Investors. Data as of May 11, 2022.

Enter real assets

Fortunately, real assets are tailor-made solutions to these challenges, offering inflation risk mitigation as well as providing broad diversification benefits across market environments. The diverse set of asset classes that include real estate, agriculture, infrastructure, energy, commodities, natural resources, and timber—collectively, real assets—are securities whose underlying value is tied to a tangible asset or linked (inherently or contractually, implicitly or explicitly) to the rate of inflation.

When combined with the low correlations to traditional asset classes, the attractive real yields and often lower risk profiles of real assets mean that the asset class may enhance portfolio risk-adjusted returns. This is especially important if inflation is stickier and more stubborn than expected due to supply chains, consumer demand, and rising expectations, as investors are experiencing today.

Infrastructure investments are one of these attractive real assets that can outperform in the current environment. As demand for critical services is less sensitive to inflation, owners of certain infrastructure assets can sustain and increase prices without significantly impacting demand, offering important opportunity for inflation protection. Furthermore, they typically have predictable cash flows associated with the long-lived assets and offer exposure to the global theme of de-carbonization, which presents a multi-decade tailwind for utilities and renewable infrastructure companies.

In fact, certain regulated utilities even have a direct pass through of inflation, making their revenue streams very attractive in today’s market. Certain user-pay assets, such as toll roads, have a similar sensitivity, whereby their prices are automatically adjusted for inflation.

Real assets can also provide opportunities to access attractive investment themes beyond inflation mitigation. One of these themes is the possibility that the global economy is entering into a new commodities supercycle— an extended period of strong demand for commodities that’s distinct from the business cycle.

These periods create strong demand for commodities and natural resources, ranging from industrial metals to energy, since these are necessary inputs to economic growth. While supply can grow, it often takes time to come online, thus driving prices higher in the meantime. Today, rapid growth in areas such as renewable energy, data centers, and consumer technology, alongside a robust economy and government stimulus, are driving the demand for commodities.

Many commodities also have natural supply limits, at least in the medium term. So-called rare earth metals, for instance, are necessary for a wide range of technology devices including batteries, cellphones, and electric vehicles. While they’re not actually that rare, extracting and processing is difficult, geographically concentrated, and takes time to ramp up. Today, China is still the main supplier of rare earth metals, although there are efforts to boost production in the U.S. and elsewhere. This limited market supply means that strong demand could continue to drive up prices.

Inflation sensitivity and market risk
Standard deviation vs. inflation sensitivity (correlation)

Scatter plot showing inflation sensitivity and market risk by real returns and real assets, as of March 31, 2022

FactSet, Bureau of Labor Statistics, Principal Global Investors. *See disclosures for risk calculation information. Data as of March 31, 2022

Whether there is a new commodities supercycle or not, the post-pandemic recovery and the war in Ukraine have already crimped the supply of energy, grains, timber, and other natural resources in the near-term. Many commodities have remained in deep backwardation since mid-year 2021—usually a signal of supply shortage concerns. These concerns look legitimate in today’s environment as demand has strongly outpaced supply due to limited capital expenditure from major commodities producers. Additionally, given the unpredictability of geopolitical events, investors should prepare to be whipsawed in this environment. Diverting supply chains, or even substituting from alternative countries, is wrought with difficulties and delays. Therefore, even pockets of commodity shortages will likely result in prolonged price pressures.

The upshot is that commodity prices could remain elevated for the next year or so, until the next economic downturn naturally reduces demand. Thus, including commodities and natural resources in a portfolio may help to offset the inflationary pressures faced by other asset classes.

Calendar year asset class returns
2012 – 2021

Table displaying calendar year asset class returns from 2012 to 2021

Morningstar, Principal Global Investors. Percentages represent calendar year index returns. Past performance does not guarantee future results. For indices, see disclosures section. Data as of December 31, 2021.

Navigating the perfect storm with real assets

With the Fed so desperately behind the inflation curve, policymakers have finally recognized the urgent need to tighten policy. But, having left it so late, an aggressive hiking cycle is now required to bring inflation back to target, risking a sharp economic downturn in the process. Recession risk for 2022 is still muted given the strength of the consumer and corporate balance sheets, but risks are rising for 2023 and beyond.

Today’s perfect storm of historically high inflation, rapidly rising interest rates, and market uncertainty, has left many standard portfolio allocations unprepared for the market environment. Additionally, capturing the upside of many structural long-term trends now often requires solutions beyond the traditional asset classes.

The standard commentary for investors during challenged market environments is to diversify portfolios, ensuring that they are appropriately allocated for their goals. In today's market, allocation to real assets can help address those challenges. Not only are real assets a natural inflation hedge, but they can also provide potentially attractive real yield with low correlations to traditional asset classes. Along with their inherent exposure to many of today’s long-term investment themes, real assets may help to boost risk-adjusted returns in a way that is tailored to the evolving market environment.

¹ As of market close, May 11, 2022.

* Standard deviation “risk” is calculated on a weighted basis over time with data as of March 31, 2022: 36-month rolling 50%, 12- month 25%, and 3-month 25%. The inflation sensitivity is calculated using 24-month rolling correlation to CPI-U non-seasonally adjusted as of March 31, 2022. Actual risk and actual correlations observed are used by the team for modeling.

Macro views

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Investing involves risk, including possible loss of principal. Past performance is no guarantee of future results. Asset allocation and diversification do not ensure a profit or protect against a loss. Investments in natural resource industries can be affected by disease, embargoes, international/political/economic developments, variations in the commodities markets/weather and other factors. Investing in derivatives entails specific risks regarding liquidity, leverage and credit that may reduce returns and/or increase volatility.

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Bloomberg U.S. Treasury Inflation Protected Securities TR Index (TIPS); Bloomberg Commodity TR Index (Commodities); FTSE EPRA/NAREIT Developed TR Index (Global REITs); S&P/LSTA Leveraged Loan TR Index (Floating rate); S&P Global infrastructure Index (Global infrastructure); S&P Global Timber and Forestry TR Index (Global timber); S&P Global Water Index (Global water); S&P Global Natural Resources Index (Global nat res); B of A 0-3 YR US Fixed Rate CMBS Index (CMBS).

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This website may contain videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions. The information and materials contained on this website, and the terms, conditions, and descriptions that appear, are subject to change. All content on this website is presented only as of the date published or indicated, and may be superseded by subsequent market events or for other reasons. In addition, you are responsible for setting the cache settings on your browser to ensure you are receiving the most recent data.

No Warranties
The information on this website has been developed internally and/or obtained from sources believed to be reliable; however Principal Global Investors and its affiliates do not independently verify or guarantee its accuracy or validity. The information and services provided on this website are provided ""AS IS"" and without warranties of any kind, either expressed or implied. To the fullest extent permissible pursuant to applicable law, Principal Global Investors disclaims all warranties, including, but not limited to, any warranty of non-infringement of third-party rights and any implied warranties of merchantability and fitness for a particular purpose. Principal Global Investors does not warrant, either expressly or impliedly, the accuracy or completeness of the information, text, graphics, links or other items contained on this website and does not warrant that the functions contained in this website will be uninterrupted or error-free, that defects will be corrected, or that the website will be free of viruses or other harmful components. Principal Global Investors expressly disclaims all liability for errors and omissions in the materials on this website and for the use or interpretation by others of information contained on the website. Subject to any contrary provisions of applicable law, no company in the Principal Financial Group nor any of their employees or directors gives any warranty of reliability or accuracy nor accepts any responsibility arising in any other way (including by reason of negligence) for errors or omissions on this website.

If you have questions, please email us.

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"These Terms & Conditions explain certain legal and regulatory conditions and restrictions in relation to the Principal Global Investors (Europe) Limited website, and in relation to the Principal Global Investors Funds (‘the Funds’). This information may be changed by Principal Global Investors at any time without notice.

In these terms and conditions, references to 'Principal Global Investors' means Principal Global Investors (Europe) Limited or any affiliate of the Principal Financial Group, Inc. or Principal Global Investors, LLC.

Before you proceed, you must acknowledge that you have read, and agree to, our terms and conditions.

Information in relation to the Principal Global Investors Funds is available through this web site to institutional investors resident in the following countries of: Belgium, France, Finland, Germany, Guernsey, Ireland, Italy, Jersey, Netherlands, Spain, Sweden, Switzerland and the United Kingdom. By proceeding this far you are representing and warranting that you are an institutional investor resident in one of these countries. Not all of the Funds are available in all these jurisdictions, and investors are directed to the Country Registration document for detailed information. What follows is not an offer or invitation to acquire an investment to, and should therefore not be relied upon by, any person anywhere other than the countries noted. Persons in respect of whom such prohibitions apply must not access this web site. This web site is reserved exclusively for non-U.S. persons and should not be accessed by any person in the United States.

Yes, I certify to be an institutional investor and resident of a country listed above.

Cookies
Use of cookies on this site is outlined in the Privacy and Security Policy. In accepting these terms and conditions, you accept the terms of the Cookie Policy and the use of cookies from this site.

Legal Entity Disclosure and Regulation
In Europe by Principal Global Investors (Ireland) Limited, 70 Sir John Rogerson’s Quay, Dublin 2, D02 R296, Ireland. Principal Global Investors (Ireland) Limited is regulated by the Central Bank of Ireland.

In the United Kingdom by Principal Global Investors (Europe) Limited, Level 1, 1 Wood Street, London, EC2V 7 JB, registered in England, No. 03819986, which is authorised and regulated by the Financial Conduct Authority (“FCA”).

In Switzerland by Principal Global Investors (Switzerland) GmbH. This website is considered as advertising and information contained herewith be treated as such. Investors can obtain free of charge the prospectus, trust deed, the prospectus, the key investor information document (KIID), and the annual and semi-annual reports from the representative in Switzerland.

In Europe and United Kingdom, this website is directed exclusively at Professional Clients and Eligible Counterparties and should not be relied upon by Retail Clients (all as defined by the MiFID and FCA respectively). If you are viewing the material as a retail investor, you should seek independent investment advice before deciding whether the products and services in question are suitable to meet your investment needs and objectives, as the language has not been complied to a retail client standard.

Principal Global Investors Funds
Principal Global Investors (Ireland) Limited is the issuer of the Funds. Investments may only be made on an application form attached to a current prospectus and following receipt by the investor of the KIID in respect of the Fund in which they intend to invest. The latest version of the prospectus of the Funds is dated 14 December 2012.

For Real estate investors in the European Economic Area (“EEA”), this website and the information on it is only directed at persons who are professional investors for the purposes of the Alternative Investment Fund Managers Directive (2011/61/EU) (“AIFMD”), professional clients or eligible counterparties for the purposes of the Markets in Financial Instruments Directive (Directive 2014/65/EU) (“MiFID II”) or as otherwise defined under applicable local law and regulation and at whom this website and the information on it may lawfully be directed in any relevant jurisdiction (“Eligible Persons”). In relation to each member state of the EEA (“Member State”) which has implemented AIFMD (and for which transitional arrangements are not/ no longer available), this website may only be accessed and interests in Funds may only be offered or placed in a Member State to the extent that: (i) the relevant Fund is permitted to be marketed to professional investors in the relevant Member State in accordance with AIFMD (as implemented into the local law/regulation of the relevant Member State); or (ii) this website and its information may otherwise be lawfully distributed and the interests in Funds may otherwise be lawfully offered or placed in that Member State (including at the initiative of the investor). In relation to each Member State of the EEA which, at the date of accessing this website, has not implemented AIFMD, this information may only be distributed and interests in Funds may only be offered or placed to the extent that this information may be lawfully distributed and the interests in Funds may lawfully be offered or placed in that Member State (including at the initiative of the investor).

Persons who are not Eligible Persons, including but not limited to those individuals or other persons who fall within the FCA’s definition of ‘retail clients’, should not use or rely upon this website or the information contained therein and may not engage the services of Principal Real Estate or any of its affiliates, or invest in any Fund. Potential investors are advised that all or most of the protections provided by the UK regulatory system will not apply and that the UK Financial Services Compensation Scheme may not be available in relation to an investment in a Fund or separate account.

The contents of this website have not been verified or approved by any competent regulatory or supervisory authority. No liability, whether in negligence or otherwise, arising directly or indirectly from the use of the information or any part of it on this website is accepted and no representation, warranty or undertaking, whether express or implied, is or will be made at any time by Principal Real Estate or its affiliates or any of their respective advisers, directors, officers, employees, representatives or other agents (“Principal Agents”) for any information or any of the opinions contained herein or for any errors, omissions or misstatements.

None of Principal Real Estate or its affiliates or any Principal Agents makes or has been authorised to make any representation or warranties, whether express or implied, in relation to Principal Real Estate or regarding the truth, accuracy or completeness of any of the information contained on this website at any time. No representation or warranty is given by Principal Real Estate, its affiliates or the Principal Agents as to the achievement or reasonableness of, and no reliance should be placed on any projections, targets, estimates or forecasts contained in the information on this website. Furthermore, nothing contained on this website is or should be relied on as a promise or representation as to the future. No reliance may be placed by any person for any purpose whatsoever on the information or opinions contained on this website or on its completeness, accuracy or fairness at any time.

Principal Global Investors (Europe) Limited is not authorised by the FCA to directly deal with retail investors; any distribution of the Fund to retail investors in Europe is facilitated by fund distributors with which Principal Global Investors (Europe) Limited has entered distribution arrangements, pursuant to advice provided to investors by those distributors, based on the documents Principal Global Investors (Europe) Limited provides. Retail investors should not be provided with access to this website.

The name of the Swiss representative is ACOLIN Fund Services AG, Stadelhoferstrasse 18, CH-8001 Zürich. The name of the Swiss paying agent is Banque Cantonale de Genève, 17, quai de l’Ile, 1204 Geneva. Investors can obtain the prospectus, trust deed, the simplified prospectuses and the annual and semi-annual reports free of charge from the representative in Switzerland.
The value of units and the income from them may fall as well as rise.

Investments in the Funds are neither insured nor guaranteed by the US Government or the Federal Deposit Insurance Corporation and are not deposits or obligations of, or guaranteed by, Principal Global Investors.

No Solicitation
Nothing contained in this website shall constitute an offer or solicitation, in relation to units in the Funds or generally, in any jurisdiction or in any circumstances in which such offer or solicitation is unlawful or not authorised.

In particular, shares issued by the Company, and units in the Funds, have not been and will not be registered under the United States Securities Act of 1933 as amended or the securities laws of any state or political subdivision of the United States and may not, except in a transaction which does not violate US securities laws, be directly offered or sold in the United States or to any US Person. The Company will not be registered under the United States Investment Company Act of 1940 as amended.

This website is reserved exclusively for non-US persons and should not be accessed by any person in the United States.

No Investment Advice
The information in this website contains general information only on investment matters and should not be considered as a comprehensive statement on any matter and should not be relied upon as such nor should it be construed as specific investment advice, an opinion or recommendation. The general information it contains does not take account of any investor’s investment objectives, particular needs or financial situation, nor should it be relied upon in any way as a forecast or guarantee of future events regarding a particular investment or the markets in general. Past performance is not a reliable indicator of future performance and should not be relied upon as a significant basis for an investment decision.

You should also inform yourself as to (a) the possible tax consequences, (b) the legal requirements and (c) any foreign exchange restrictions or exchange control requirements which you might encounter under the laws of the countries of your citizenship, residence or domicile and which might be relevant to any investment, including the subscription, holding, transfer or disposal of units in the Funds

Delegation of Investment Management to Affiliates

Products upon which composite results contained in this material, if any, are based may not themselves be available in the United Kingdom and certain other jurisdictions; however, the underlying investment management capability can be made available to institutional investors subject to all applicable local regulations and restrictions. In connection with its management of client portfolios, PGIE may delegate management authority to affiliates that are not authorised and regulated by the Financial Conduct Authority. In any such case, the client may not benefit from all protections afforded by rules and regulations enacted under the Financial Services and Markets Act 2000.

Disclaimer
The information on this website is given by Principal Global Investors in good faith and has been derived from sources believed to be reliable and accurate as at their date. However, Principal Global Investors makes no representation or warranty of any kind for the accuracy or completeness of the information and it is under no obligation to update or correct any errors in the information after the date of publication. This website also contains videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions.

Subject to applicable law, Principal Global Investors and its affiliates and their respective directors, employees and associates do not accept any responsibility arising in any way (including by reason of negligence) for errors in, or omissions from, the information and do not accept any liability for any loss or damage, however caused, as a result of any person relying on any information on the website or being unable to access the website.

The Internet is not a totally reliable and secure medium of communication. Principal Global Investors accepts no liability for the security or confidentiality of information transmitted in this way and any such transmission of information shall be at your own risk.

The entire content of this website is subject to copyright with all rights reserved. You may not copy, reproduce, distribute or modify the content of this website without the prior written permission of Principal Global Investors.

No instructions for investment purposes will be accepted directly from this website or by e-mail.

If you accept these terms and conditions, click “Accept.”

You are about to leave PrincipalAM.com and be directed to our Japanese site, PrincipalGlobal.jp. If you wish to proceed, please click "Accept." If you would like to stay on PrincipalAM.com, please click "I do not accept."

You may view, download for caching purposes only, and print content from the website for your own personal use, subject to the restrictions set out below and elsewhere in these Terms of Use.

No Guarantee of Timeliness
This website may contain videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions. The information and materials contained on this website, and the terms, conditions, and descriptions that appear, are subject to change. All content on this website is presented only as of the date published or indicated, and may be superseded by subsequent market events or for other reasons. In addition, you are responsible for setting the cache settings on your browser to ensure you are receiving the most recent data.

No Warranties
The information on this website has been developed internally and/or obtained from sources believed to be reliable; however Principal Global Investors and its affiliates do not independently verify or guarantee its accuracy or validity. The information and services provided on this website are provided ""AS IS"" and without warranties of any kind, either expressed or implied. To the fullest extent permissible pursuant to applicable law, Principal Global Investors disclaims all warranties, including, but not limited to, any warranty of non-infringement of third-party rights and any implied warranties of merchantability and fitness for a particular purpose. Principal Global Investors does not warrant, either expressly or impliedly, the accuracy or completeness of the information, text, graphics, links or other items contained on this website and does not warrant that the functions contained in this website will be uninterrupted or error-free, that defects will be corrected, or that the website will be free of viruses or other harmful components. Principal Global Investors expressly disclaims all liability for errors and omissions in the materials on this website and for the use or interpretation by others of information contained on the website. Subject to any contrary provisions of applicable law, no company in the Principal Financial Group nor any of their employees or directors gives any warranty of reliability or accuracy nor accepts any responsibility arising in any other way (including by reason of negligence) for errors or omissions on this website.

If you have questions, please email us.

Click ""Accept"" to indicate your acknowledgement and acceptance of Principal Global Investors Terms of Use and to continue."

This website contains general information only on investment matters and nothing in this website is intended to constitute or form part of any offer or inducement to issue or sell, or any solicitation of any offer to subscribe for or purchase, any securities or investment products in the UAE (including the Dubai International Financial Centre) and accordingly should not be construed as such. Information in this website is not directed at you if we are prohibited by any law of any jurisdiction from making the information on this site available to you and is not intended for any use that would be contrary to local law or regulation. Products or services mentioned on this site are subject to legal and regulatory requirements in applicable jurisdictions and may not be available in all jurisdictions. Accordingly, persons are required to inform themselves of and observe any such restrictions.

The information in this website is being made available on the basis that the recipient acknowledges and understands that the entities and securities to which it may relate have not been approved, licensed by or registered with the UAE Central Bank, the Dubai Financial Services Authority or any other relevant licensing authority or governmental agency in the UAE or elsewhere in the Middle East.

The information in the following website should not be construed as investment advice or a recommendation for the purchase or sale of any security. The value of investments and the income from them may fall as well as rise. Principal Investor Management (DIFC) Limited and the other member firms of Principal (collectively, the “Firms”) do not guarantee any investment results and there can be no assurance that the strategies employed will improve investment performance, and make no guarantee that a client’s investment objectives will be achieved and no warranties or representations, expressed or implied, are made by the Firms concerning the benefits of these strategies discussed herein. The information in this website has been developed internally and/or obtained from sources that the Firms believe to be reliable; however, the Firms do not guarantee the accuracy, adequacy or completeness of such information and are not responsible for any errors or omissions. This website also contains videos where the comments were valid on the date the video was recorded. Markets move continuously and you should only rely on current information for any investment decisions.

This website contains general information only on investment matters and should not be considered as a comprehensive statement on any matter and should not be relied upon as such. The information it contains does not take account of any investor’s investment objectives, particular needs or financial situation. Past performance is not a reliable indicator of future performance and should not be relied upon as a significant basis for an investment decision. You should consider whether an investment fits your investment objectives, particular needs and financial situation before making any investment decision.

Nothing in this website should be construed as investment, tax, legal or other advice.

The content of this website has not been approved by or filed with the UAE Central Bank or Dubai Financial Services Authority.

Access to this website is only permitted for “Professional Clients” as defined in the Conduct of Business of the Dubai Financial Services Authority’s Rulebook. If you are not a “Professional Client”, you may not access this website and you should select the “Decline” link below.

By selecting the “Accept” button below, and entering this website, you agree to these terms and confirm and represent that you are a “Professional Client”.