Nattakrit Laotaweesap, Head of Wealth Advisory at TISCO Bank Public Company Limited, revealed that amid mounting global economic uncertainty—particularly the ongoing trade war between the US and its trading partners—TISCO Bank is offering three investment strategies to weather the economic storm.
These strategies comprise investment options for survival during a profound economic downturn, as well as two additional alternatives for periods of economic slowdown: resilient stocks impervious to trade conflicts, and continuously growing megatrends.
In the current volatile environment, TISCO recommends investing in mutual funds focused on “Global Bonds,” classifying them as “safe havens in a deteriorating world.” Historical data supports this approach, indicating that in the event of a global recession, such bonds can deliver average returns of up to 8% over a 12-month period.
Nattakrit further noted that uncertainty looms over international trade negotiations, with tariff postponements set to expire on July 9.
Concurrently, many countries’ economic indicators signal weakness amid persistently high bond yields. This scenario presents opportunities for investors to benefit not only from interest income but also from price appreciation.
According to TISCO, Global Bonds are highly resilient to economic volatility and help diversify risk, given their exposure to debt instruments across multiple regions and currencies. Moreover, they serve as an effective risk management tool, particularly if the global economy indeed slips into recession.
Historical data highlights that, over the past 30 years, the Global Bond Index has yielded an average return of 5% in the six months preceding a recession and an additional 3% in the subsequent six months, totaling an average annual return of 8% during recessionary cycles. This figure far exceeds the long-term average annual return of just 3.3%.
Currently, the Global Bond Index offers a yield-to-maturity of approximately 3.6% per annum, significantly higher than Thai bonds’ yield of only 1.7%. Additionally, there is potential for further price gains if central banks worldwide continue to pursue accommodative monetary policies.
Nattakrit emphasized that should trade negotiations fail to progress, increased tariffs could disrupt supply chains and raise business costs, which could further slow down the manufacturing sector and induce greater volatility in equity markets—especially if Q2 economic numbers deteriorate as a result of import tariffs.
