Swiss economists and investors were in agreement it is ‘not the time to buy the dip’ as markets continue to plunge into turmoil following US President Donald Trump’s tariff measures and subsequent responses from US trading partners.
Adrien Pichoud, chief economist and senior portfolio manager at SYZ Group said the story of US exceptionalism from 2024 is being eroded.
Pichoud said his approach is to add some downside protection rather than reduce outright exposure in portfolios.
“What is clear for us in this stage is that we are not willing to buy the dips either,” he added.
Meanwhile, Mikaël Safrana said his firm is diversifying through regions, especially Europe and Switzerland.
Later in the week, a 90 day pause on tariffs triggered major market rallies, but most US trading partners still face a looming 10% tariff and tensions with China are elevated with a 125% tariff remaining in place.
As a result, UK fund selectors predicted a gradual but constant outflow from US equities, with investors seeking safer opportunities in UK, German, Japanese and even Chinese assets.
Active ETFs battle for market maker backing
Active ETF managers in Europe are finding it tough to secure market making support as demand for liquidity providers skyrockets.
With no easy hedging options, active ETFs often trade at wider spreads, which can deter investors worried about high trading costs.
For example, newcomers iMGP has faced challenges building relationships and setting up operations from scratch.
As competition heats up, many are turning to white-label platforms that offer ready-made connections with market makers.
Meanwhile, early movers like Fair Oaks Capital have had more success, highlighting just how critical timing and strong partnerships have become in the increasingly crowded active ETF space.
Goldman Sachs and BNP Paribas to enter systematic active ETFs
Goldman Sachs Asset Management (GSAM) and BNP Paribas Asset Management (BNPP AM) are stepping into Europe’s fast-growing systematic active ETF space.
GSAM will launch five active equity ETFs across five regions, while BNPP AM will debut one active equity and three active fixed income ETFs, all domiciled in Luxembourg.
Unlike their earlier ESG-focused products, BNPP AM’s new range will target alpha generation. As competition heats up, other players like DWS are also gearing up to enter the space.
