Stretched valuations make allocation decisions harder: Researcher
Callum Thomas launched Topdown Charts, from Queenstown, at the end of last year.
He said its services were aimed primarily at fund managers but it had been of interest to advisers, particularly those who were focused on active management.
He said advisers were concerned about valuations. “Particularly the US market. That’s one that people look at most on the over-valuation front. There are a lot of signs there that are similar to what we saw going into the dotcom boom. It raises a tricky challenge – do you pull back your allocation based on the valuation, and you might miss out on another who knows how much percentage return?”
He said New Zealand’s share market looked similarly stretched. “Valuations are on the expensive side, especially compared to recent history.”
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