Thought Starters 5 minutes to read

The benefits of multi-asset trading

Saxo Bank

Summary:  In today’s global markets, geopolitical and economic risk are ever-present. To protect your portfolio, you’ll need a strategy that defends against those risks – and for many traders, multi-asset trading is becoming their tool of choice, not only to mitigate risk but even to capitalise on the markets’ volatile movements.

Click here, for a preview in SaxoTraderGo.

Interesting times
The ancient Chinese curse “May you live in interesting times” has probably been on every trader’s mind during 2019. The US-China trade war has been escalating – this summer, the US expanded its tariffs on Chinese goods to US $250 billion, threatening to bring the total to US $300 billion in the future.

The trade war’s impact on the markets has been considerable, wreaking havoc on the tech, auto and agriculture sectors. In May 2019, when the US announced it was increasing tariffs from 10% to 25%, the S&P and the Dow both fell over 2% over the following week. The damage was even higher for the tech-heavy Nasdaq, which fell more than 3.3%.

And it’s not just the US markets being jolted by economic and political events. The trade war waves have reached Germany, where weaker demand for machinery and cars has seen exports decline in the second quarter, while the UK is still being rocked by the fall-out from Brexit, with the GBP weakening dramatically since the 2016 referendum.

Risk mitigation through diversification
While economic uncertainty is seemingly becoming the new normal, pursuing a diversified trading strategy through multi-asset trading is a way for traders to mitigate unsystematic risk. More specifically, by investing across asset classes such as bonds and FX, or across different sectors and geographies, one can reduce asset-specific risk.

Tactical Asset Allocation
The drivers of an economic cycle can be granulated into specific indicators, including the yearly change in Baa-Aaa corporate bond spreads and the annual gold price change. Increased Baa-Aaa spreads and positive gold price changes constitute recession characteristics, where investors seek safe haven investments such as government bonds. In contrast, a falling gold price and decreased spreads are signaling an expansion phase. Correlation between equity market performance and negative gold price changes was seen in 2013, when the best performing year for U.S. equities since the financial crisis was accompanied by a large gold price drop.

As economic cycles have different phases, key in a trading strategy is to identify the asset classes which relatively outperform in each period. Tactical asset allocation is an active trading strategy that change the percentage of different asset classes to take advantage of pricing fluctuations in the market. 

SaxoTraderGO: Access to more than 40,000 instruments
As a pioneer in multi-asset trading, we early on identified the benefits of trading across asset classes, sectors and geographies. Today, Saxo provides access to more than 40,000 instruments through our intuitive trading platforms.

Having access to a full range of asset classes has turned out to be a huge advantage not only for retail traders but also for institutions such as banks and wealth managers, who are able to reduce internal costs and comply with increasing regulations more intuitively by using just one trading platform.


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (
- Full disclaimer (

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15


Trade responsibly
All trading carries risk. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.