Messy Reality
Friday, August 19th, 2022 Categories: Global Equities, Risk aversion, Sector Strategy
Using sector betas to evaluate investor attitudes to risk
We wanted to get a handle on which equity regions had the most risk-averse investors, so we measured the beta of our recommended overweight and underweight sectors. We found that reality is much messier than we thought and that pre-conceived, US-centric attitudes to risk do not translate well to other regions. Our numbers suggest that Eurozone investors are the most risk averse, but the sectors they use to express this view are not the ones that US investors would choose.