03 July 2009 at 14:21 GMT
Saxo Bank's asset allocation model underlines the bearish stance that the bank's research department has taken in the recent 'green shoots' debate since the market upturn in March.
The allocation model, published today, maintains the past 15 months allocation with a overwight in bonds (70%) and the remainder in short stocks and commodities.
The only change has been the move at the beginning of last month (June) to short duration bond exposure.
The current scenario is “outright bearish”, since the global economy is decelerating at a record pace. Deflation – or at least disinflation – is a likely outcome in this scenario and therefore the model is recommending a heavy exposure to bonds while shorting business cycle sensitive asset classes like especially EM stocks and Commodities and Stocks in general.