Jacob Rothschild Aggressively Trims His Exposure To Risky U.S. Capital Markets

Sang TanAP Images

Jacob Rothschild has aggressively minimized his exposure to what he views as a risky U.S. capital market. Rothschild is the founder and chairman of Rit Capital Partners. In the half-year financial report for Rit Capital Partners, Rothschild explained the companies significant exposure reduction to U.S. assets.

Rothschild stated, “We do not believe this is an appropriate time to add to risk. Share prices have in many cases risen to unprecedented levels at a time when economic growth is by no means assured. “

Rothschild also gave his opinion that he believes quantitative easing programs employed by central banks, such as the Federal Reserve Bank in the U.S. will no longer be implemented. Rothschild was quoted in the written report as saying, “The period of monetary accommodation may well be coming to an end.”

The British investment banking veteran has significantly reduced the amounts of investment Rit Capital Partners has in the U.S. dollar. On December 31, 2016, Rit Capital Partners reported a 62 percent net value asset investment in U.S. dollars. In the latest report released by Rit Capital Partners on June 30, 2017, the company has a 37 percent net value asset investment in U.S. dollars.

Rothschild has increased his investment in the Sterling, Euro, and the Japanese Yen over the same time period.

New York Stock Exchange screen showing the Dow Jones closed above 22,000 points [Image by Richard Drew/AP Images]Featured image credit: Richard DrewAP Images

Rothschild offered analysis on his current investment strategies, stating, “We have a particular interest in
investments which will benefit from the impact of new technologies, and Far Eastern markets, influenced by the
growing demand from Asian consumers.”

However, Rothschild announced an investment in Social Capital, a technology investment firm, based in Silicon Valley. Francesco Goedhuis, the Chief Executive of J. Rothschild Capital Management, will be serving on the Advisory Board of Social Capital.

Jacob Rothschild At Wine Unveiling
Jacob Rothschild speaks at the unveiling of the bottle design for the vintage wine of Château Mouton Rothschild [Image by Frank Augstein/AP Images]Featured image credit: Frank AugsteinA

Rothschild mentioned an interest in the fourth industrial revolution in the Rit Capital Partners report. Rothschild stated, “As the ‘Fourth Industrial Revolution’ develops, it becomes increasingly important for your Company to be
able to assess investment opportunities in the innovation driven changes which are affecting almost every
business sector.”

The fourth industrial revolution is centered around new technologies that further integrate the biological, physical, and digital worlds.

Rothschild indicated in the report that the fourth industrial revolution was a driving factor in his investment in Social Capital. Social Capital provides seed funding for companies in the education, finance, and health care business sectors.

[Featured Image by Sang Tan/AP Images]