2Q 2022 Market and Economic Overview

As inflation has taken centre stage in the second quarter of the year, financial markets across all asset classes have retraced substantially. The persistence of Covid, ongoing war in Eastern Europe, decades-high levels of inflation in most parts of the world, shifts in monetary policy in the US and Europe, as well as fears of economic slowdown, and possibly a recession, have taken equity markets into a bear market (a condition in which securities prices fall 20% or more from recent highs). The market environment continues to be very challenging and hence, requires a tactical approach to portfolio management and asset allocation. Notwithstanding the uncertainties caused by the above-mentioned events, our Asset Management team continues to closely monitor the situation and tries to identify appropriate investments for our clients’ portfolios. We believe that holding a well-diversified portfolio of equities and other selective asset classes would not just preserve your capital in the long term but also allow you to significantly grow it, even during times of elevated uncertainty. In the next few pages, we try to explain the link between the current macroeconomic environment and the potential risks and rewards of the investment strategy we pursue