The threat posed by global populism is the biggest macro risk facing investors—even greater than global growth stalling—Tom Clarke, co-portfolio manager on William Blair’s Dynamic Allocation Strategies team, recently told Citywire Selector.

“Markets do not like political uncertainty, and most of these situations have involved scenarios where you have various political leaders or would-be political leaders deliberately raising the level of uncertainty by trying to pursue their own objectives at the expense of others,” Clarke told Citywire Selector.

He added that populist movements across the globe share a common trait, namely a general preference for less free trade and less free flow of immigration, which create economic growth headwinds.

Investing Implications

In the interview, Clarke said that currently the biggest populist threat is the upcoming French election, which makes the Dynamic Allocation Strategies team cautious on French equities.

“Every victory that populism has—Brexit, President Donald Trump, a resounding ‘no’ in the Italian referendum—emboldens would-be populists elsewhere, such as Marine Le Pen and makes investors much more cautious because these things are proving to be more powerful than they thought,” Clarke said.

The U.S. presidential election, for example, has impacted currency opportunities. Clarke highlighted to Citywire Selector that the Mexican peso has been one of the biggest losers from Trump’s win, which has made the currency more attractive. On the flip side, the Russian ruble has strengthened post Trump’s victory, but it’s still a compelling investment opportunity.

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Factual information has been taken from sources we believe to be reliable, but its accuracy, completeness or interpretation cannot be guaranteed. Investments are subject to market risk. Forecasts, estimates, and certain information contained herein are based upon proprietary research and should not be interpreted as investment advice, as an offer or solicitation, nor as the purchase or sale of any financial instrument. Statements concerning financial market trends are based on current market conditions, which will fluctuate.

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Copyright © 2017 William Blair & Company, L.L.C. "William Blair” is a registered trademark of William Blair & Company, L.L.C. No part of this material may be reproduced in any form, or referred to in any other publication, without express written consent.

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Please carefully consider the Funds’ investment objective, risks, charges, and expenses before investing. This and other information is contained in the Funds’ prospectus, which you may obtain by calling +1 800 742 7272. Read it carefully before you invest or send money. Investing includes the risk of loss.

Any statements or opinions expressed are those of the author as of the date of publication, are subject to change without notice as economic and markets conditions dictate, and may not reflect the opinions of other investment teams within William Blair Investment Management, LLC or the Investment Management Division of William Blair & Company, L.L.C.

This content is for informational and educational purposes only and not intended as investment advice or a recommendation to buy or sell any security. Investment advice and recommendations can be provided only after careful consideration of an investor’s objectives, guidelines, and restrictions.

Factual information has been taken from sources we believe to be reliable, but its accuracy, completeness or interpretation cannot be guaranteed. Investments are subject to market risk. Forecasts, estimates, and certain information contained herein are based upon proprietary research and should not be interpreted as investment advice, as an offer or solicitation, nor as the purchase or sale of any financial instrument. Statements concerning financial market trends are based on current market conditions, which will fluctuate.

William Blair does not provide legal or tax advice. Please consult your tax and/or legal counsel for specific tax questions and concerns.

Distributed by William Blair & Company, L.L.C., member FINRA/SIPC.

Copyright © 2017 William Blair & Company, L.L.C. "William Blair” is a registered trademark of William Blair & Company, L.L.C. No part of this material may be reproduced in any form, or referred to in any other publication, without express written consent.

Statement of Financial Condition | NMS Rule 605 & 606 | Business Continuity Plan | UK Stewardship Code
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