The financial markets remain influenced by developments in the trade conflict between the USA and China, and geopolitical uncertainties about a real Brexit solution. At times of US yield curve inversion and volatilities balanced diversification of investments across various asset classes has been an effective investment approach. In view of ongoing rate cuts around the world and the bifurcated development of the global economy – quite robust consumer spending and service sector activity on the one hand, but below-average industrial production on the other – a diversified asset allocation looks all the more appropriate at present.  

Quantitative monetary easing, falling interest rates, low valuations of banking stocks and “financial repression” – all these developments now evident in Europe are familiar to us from many years ago in Japan. The conclusion is that cash is becoming even less attractive, and that without diversified risks it is unlikely that positive returns will be possible. 

The turbulent performance of Bitcoin over the last year has brought this cryptocurrency to the attention of the wider public. But this currency has actually been around for almost ten years, and an estimated 1,600 other alternative currencies have also sprung up in the meantime. The question is often asked whether these constructs – which only exist in the form of digital code – can really be considered currencies at all in a way that bears comparison with the dollar, euro or yen. We will return to this question later in this article. First of all it is worth establishing what actually lies behind cryptocurrencies such as Bitcoin, Ether and Ripple.