Articles

As we move into the final quarter of the year, after a period in which markets have been dominated by the share prices of lower quality companies, in areas such as unprofitable technology and “meme” stocks, we believe the market distortion which has characterised 2025 is on course to revert, bringing our commitment to quality back into favour.

In his lead piece, Guy Monson shares his optimism for equity markets and explains why we remain committed to quality thematic stocks at a time when markets have been led by a rush into highbeta,speculative investments. While this emphasis may mean we lag indices in exuberant phases, we remain confident in the longterm prospects of companies demonstrating strong returns on equity and stable earnings growth.

From an economist’s perspective, Adam Hamilton and Subitha Subramaniam focus on the UK ahead of the all-important Autumn Budget. They argue that without a clear vision for the role of the state and a plan to drive productivity, there is a risk of drifting into a managerial political style that keeps the numbers tidy while the economy stagnates.

Our Charity Focus, written by Mashrufa Miah, explores the conundrum faced by charities seeking to balance their financial objectives with ethical and reputational considerations. She looks in particular at the challenges within the defence and technology sectors, calling for a more nuanced debate beyond simple disinvestment.

Drawing further on our stewardship expertise, Natasha Landell-Mills questions the effectiveness of carbon accounting frameworks, arguing that they do little to identify where the most powerful levers for decarbonisation reside. While essential, the Scope 1-3 emissions framework says little about how businesses actually reduce their emissions.

Following on from his bond myth-busting article in our last edition, Michael Jervis examines one of the most fundamental changesin the fixed income landscape today – the reversal of the supply-demand balance. The previous regime of quantitative easing has given way to the realities of quantitative tightening, meaning new central bank bond purchases are now a distant prospect. What does this mean for portfolio positioning?

Also in this edition, Tom Kight considers the shifting environment for consumer staples as part of Sarasin’s Evolving Consumption theme. He looks at how profit pools are moving away from established food brands and towards retailers with their private label ranges.

We hope you find our insights useful and, as ever, we welcome your feedback and suggestions for future topics.