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Horlick says equities at cheapest level since 1959

The price of fixed interest is too high but equities are at their cheapest level since 1959, says SG Asset Management chief executive Nicola Horlick.

Horlick told the summit that loss of confidence in equities has forced pension funds and other institutional investors into fixed interest, which has fuelled unrealistic prices.

She said examining equity prices since 1850 showed there are two sorts of bear markets – those related to technological revolutions, which last between three and five years, and the normal cyclical downturns that tend to last only one year.

Horlick said: “The industry grew because of the belief in equities and has suffered as equities have failed. As markets recover, confidence will return.”

Hallmark-ifa managing director David Holbrook says: “We have two camps – those that say the cross-over of bond and equity yields is great for the equity market, and those that say the opposite. I am happy just to wait and see.”

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