The financial markets have started what is expected to be a difficult year in 2023. Andreas Wölfl, founder and Chairman of the Board of Directors of the European certificate issuer iMaps ETI, ventures an outlook for the coming 12 months with four theses and takes a clear stance on the following topics: dwindling stock market prices, gold price trends, Asian and crypto investments.
Liechtenstein 17 January 2023 – Although the stock markets have made a generally positive start to the new year, this should not obscure the fact that a year characterized by high risks lies ahead. Investors should keep an eye on four issues in particular: The continued shrinking number of listed companies in Germany, the comeback of gold, new opportunities in Asia and the resurgent crypto market.
- The bear market will continue and the number of shares listed on the regulated market in Germany will fall.
The bear market is likely to continue in 2023. Although the inflation rate is likely to return to single digits, the expectation that inflation will persist for many years, if not decades, will prevail. The market will finally lose confidence in the central banks’ ability to maintain the inflation target of 2% on average. Europe and Germany are in danger of slipping into recession. However, the central banks are unlikely to be in a position to take countermeasures as they have already shot their powder. The European Central Bank in particular has its hands tied, as the necessary steps to curb inflation would jeopardize the common currency, the euro, as a whole. It can therefore be assumed that the central banks will hit the brakes to avoid triggering state crises and bankruptcies. In this environment, we expect that no or only a few windows for new IPOs will open up and, on the contrary, that some companies will even delist. Overall, the market will be further thinned out and the number of companies listed on the regulated market in Germany will continue to fall. We are pessimistic about the DAX. We expect the 12,000 point mark to be tested once again and a negative return for the year as a whole with a DAX target of 13,000 points.
- The comeback of the gold price
The surprise of 2023 will probably be the comeback of the gold price. In the environment outlined above, demand will increase massively. We are already seeing the first signs of this. In 2022, central banks around the world increased their gold holdings more than at any time since the introduction of the US dollar standard. They will continue this trend and, in response to geopolitical tensions, use gold even more for diversification in order to be less dependent on the US dollar. This applies in particular to the central banks of the emerging markets. As soon as institutional investors also start to build up gold positions again due to a lack of alternatives, the price will only know one direction. We believe a rise to USD 2600 is realistic.
- Asia offers opportunities again
China’s zero-Covid policy has not only weighed on the Chinese stock markets, but has also contributed to underperformance in Asia as a whole. The strong appreciation of the US dollar in 2022 also contributed to the US stock markets outperforming the Asian markets. However, valuations in Asia are now extremely attractive again and the strong appreciation of the US dollar should be coming to an end. The end of the zero-covid policy in China will provide a further tailwind for economic life in Asia. It is conceivable that in 2023, the Biontech vaccine will be the first non-Chinese coronavirus prevention product to be approved nationwide in mainland China. This would make the cash registers of Fosun International and its subsidiary Fosun Pharma, Biontech’s partner in China, ring strongly. So far, approval has only been granted for Hong Kong, Macao and foreigners in the People’s Republic, as well as in Taiwan. Taiwan, however, does not want to administer a Biontech vaccine for political reasons. Accordingly, we see an admixture of Fosun International shares and our iMaps Asia Opportunities ETI as favorites, which covers a broad portfolio of Asian stocks in the underlying.
- Thaw in Kryptoland
2022 was a particularly bad year for crypto investments, which reached another negative peak towards the end with the spectacular collapse of the FTX empire. It can be assumed that Bitcoin, Ether & Co will remain very volatile in 2023. However, it is still too early for the current swan song for digital gold. We expect further corrections in the first half of the year, but then a comeback by the end of 2023. Although Bitcoin will remain well below the highs of the last bull market, its price will still be significantly higher than it currently is. We are even more bullish in our forecasts for Ether and see a price target of USD 2,000 by the end of 2023. One way to benefit from the comeback of the crypto market is the iMaps smart Blockchain ETI issued by us, which bundles several native tokens of smart blockchains in the underlying asset, i.e. those that offer smart contract functionality like Ethereum and therefore represent the infrastructure of Web 3.0.
Conclusion: Although the coming year is once again expected to bring major economic challenges, it will also bring opportunities in some cases. The price of gold is on the upswing and promises to break its historic high. Due to the weak performance last year, Asian stocks and cryptocurrencies also have good growth potential.
About iMaps ETI AG
iMaps ETI AG is an issuer of Exchange Traded Products (ETP) in the Principality of Liechtenstein with a focus on asset manager certificates in the form of Actively Managed Certificates.
iMaps Capital Markets focuses on providing asset managers with a platform for issuing exchange-traded instruments (ETIs) as a white label solution in order to map the respective investment strategy. The spectrum includes ETIs on traditional investments such as equities, derivatives and funds as well as on digital assets as underlying assets. As a subgroup of exchange-traded products, they are an interesting, fast-growing and cost-effective alternative to funds. Thanks to the approved securities prospectus of iMaps ETI AG, it is also possible to offer ETIs publicly to private investors.
Further information is available at www.imaps-capital.com
Contact for media inquiries
Isabella von Köckritz / Dr. Charlotte Brigitte Looß
public imaging GmbH,
Goldbekplatz 3, 22303 Hamburg
Phone: +49 / (0)40 401 999 – 22 / – 292
E-mail: iMaps@publicimaging.de
Disclaimer: The securities base prospectus including supplements has been approved by the FMA Liechtenstein and notified to Germany, Austria, Italy, Luxembourg and Ireland. It has also been registered for the public offer in Switzerland. It is available on the website www.imaps-capital.com/etis downloadable free of charge.
