Sujata Raho’s view of the future

What percentage of investment calls were made last year? Some asset classes refused to follow the instructions, as is typical in every year.

Consider the dollar. According to BofA’s monthly survey of fund managers, the “crowdedest” trade was shorting the dollar at this point last year. Although some people have previously pointed out how the poll has served as a contrarian indicator in the past, the one this year is exceptional. It has seen a 7% increase. According to our sources, no central bank “can out-dove” Fed. But, it was not impossible.

Other markets went wrong were emerging markets. We expect a rebound on trade, tourism and commodity price, along with dollar weakness. Morgan Stanley (NYSE) a year back told its clients to “Gotta Get EM All!”

They hoped they wouldn’t. Equities fell 6% and emerging currency debt is down by 9%. These moves are full of gems: 20% gain for Indian shares, 15% increase for frontier markets equities. Unfortunately there were also some Turkeys.

The lira is still down around 50% despite some unconventional measures taken by the administration in order to fix the damage.

The commodities and oil bet worked, but so has U.S. Tech. It is the gift that kept on giving – despite the dangers of higher fines, increased taxes, and more challenges by smaller tech firms, U.S. growth was 26%.

The makers of semiconductors, often called the new oil, are also on the rise at 40%. This is not far from the 45% rebound.