Spotlight: The Zoology of Investing

Zoology is often described as the scientific study of the behaviour and structure of animals. Investing on the other hand, is the process of buying assets that aim to increase in value over time or provide an income. These two things may seem worlds apart, however, you’d be forgiven for mistaking some economic and investments media coverage for an episode of Our Planet, as there are several references to animals that are used to describe certain market trends and activities. Below are some of the most common animal analogies used in the world of investing.
Bull and Bear markets – A bull market or “bullish” describes optimistic periods when prices are rising, and a bear market or “bearish” is used during pessimistic times when prices are falling. This is thought to originate from the way that each animal prepares to attack. Bulls attack by putting their horns up, whereas bears attack by drawing their paws downwards. The chart below illustrates both bear and bull market movements over a period of time, it is for illustrative purposes only.

Doves and Hawks – Hawks in the context of monetary policy, are policymakers who prioritise controlling inflation, often at the expense of other economic objectives such as economic growth, consumer spending, or employment. The term "hawk" is derived from the analogy of a bird of prey that swoops down aggressively to control its target. The term "dove" is derived from the peaceful and gentle nature of the bird, symbolising a preference for a more lenient approach to monetary policy. Doves are generally more concerned about reducing the negative impacts of economic downturns and unemployment, often prioritising these objectives over strict inflation control.  Therefore, the terms "hawk" and "dove" represent two contrasting approaches to monetary policy, with hawks emphasising inflation control and doves focusing on stimulating economic activity. 
Black Swans –The term "black swan" originates from an ancient belief that black swans did not exist, a notion that was challenged once black swans were first discovered in Australia in 1697. This discovery led to a reinterpretation of the term to signify an unforeseen event. In the financial world, a black swan is a highly unpredictable but hugely transformative event in markets that reshapes the investment environment. For example, the 2008 Global Financial Crisis or the 9/11 terrorist attacks would be considered as black swan events.
Cash Cows – Think of a dairy cow that, as long as it has a field to graze, will continually provide milk throughout its lifetime. In the investment world, cash cows represent products or assets that provide consistency, in the form of positive cash flow, with very low maintenance (or capital) needed. They are seen as low risk but high reward investments.
Dead Cat Bounce – This is a slang term used to describe a short or temporary period of recovery during a prolonged declining or bear market. It can be used to describe a brief uptick in the share price of a particular company or in the market as a whole. The phrase is based on the belief that if you throw a dead cat far and fast enough, it will still bounce.
Unicorns – The term "unicorn" is used to describe a private startup company that boasts a valuation of $1 billion+. Unicorns are considered exceptionally rare and typically emerge through groundbreaking innovation. Given their substantial size, investors in unicorn companies are often private investors (or venture capitalists), placing them beyond the reach of retail investors.  Unicorns capture the imagination of investors and the public alike due to their potential for massive growth and impact on industries. However, they are also seen as high-risk investments, as not all unicorns ultimately achieve the success predicted for them.

The Noise​

  • UK inflation slowed in February, falling to 3.4% in the 12 months to month end from a 4% increase in January. This is the lowest level of inflation since September 2021, per official data from the Office for National Statistics. It also fell more than expected as economists and the Bank of England’s own forecasts had predicted an annual increase of 3.5%. Food and prices at restaurants and cafes were the biggest downward drag on prices, though there was upward pressure from motor fuel, housing and household services. Core inflation, which excludes volatile goods such as energy and energy also slowed to 4.5% in February from 5.1% in January. Traders increased bets on interest-rate cuts for the year following the data release, and the pound weakened against a basket of global currencies.

  • ​The Bank of Japan, ended eight years of negative interest rates this week, setting a new short-term rate target range of 0-0.1%, while also applying a 0.1% interest to reserves. This is a historic shift away from an unorthodox policy that focused on reflating growth through massive monetary stimulus. The widely expected decision was the first interest rate hike in 17 years for the Bank of Japan and signals its confidence that Japan has emerged from the perils of deflation. The central bank also abandoned yield curve control, a policy that capped long-term interest rates around zero and stopped the purchasing of risky assets. Demonstrating the prolonged existence of negative rates in Japan, regional banks are offering e-learning courses to staff with no experience lending money or collecting deposits in a positive rate environment.

  • The UK government has launched a consultation to determine the best way to apply a new carbon import levy, which from 2027 will look to protect businesses against cheaper imports from countries with less strict climate policies. The planned carbon border adjustment mechanism will apply to imports of carbon-intensive products in the iron and steel, aluminium, fertiliser, hydrogen, ceramics, glass, and cement sectors. Currently, the UK’s emissions trading system charges power plants, factories, and airlines for each tonne of carbon dioxide they emit. The methodology used to set fees in the new import levy will depend on the amount of carbon emitted in the production of the imported good and any gap between the carbon price applied in the country of origin and the carbon price faced by UK producers.


The Numbers

GBP Performance to 21/03/2024

Equity GBP Total Return

1 Week








MSCI Europe






MSCI Japan



MSCI Asia Pacific ex Japan



MSCI Emerging Market






Fixed Income GBP Total Return


UK Government



Global Aggregate GBP Hedged



Global Treasury GBP Hedged



Global IG GBP Hedged



Global High Yield GBP Hedged



Currency moves












Commodities GBP return









Source: Bloomberg, data as at 21/03/2024

The Nuance

Many of the world’s biggest central banks held their monetary policy committee meetings this week, as they all seem ready to kick off on rate cuts. The way down though from decade-high rates will be a lot more stop-start than the go-go-go attitude we saw on the way up. Central banks on opposing sides of the Atlantic are likely to move in smaller increments with periodic pauses, fearing that ultra-low unemployment could rekindle inflation rates still above their targets. The eventual settling point for interest rates is likely to be far higher than the historic lows witnessed in the past decade. Significant transformations in the global economic landscape could put borrowing costs on a higher path for years to come.

The Swiss National Bank became the first major central bank to easy policy this week, with a surprise 25 basis point cut to its key rate. Inflation has already dropped into its 0% to 2% target range in Switzerland, with a lowered inflation forecast giving it the green light to cut rates.

The Bank of England kept interest rates at 5.25% this week, as the economy moves closer to the point at which the central bank feels comfortable cutting rates. Sterling fell, shares jumped, and government bond prices rose as policymakers voted eight in favour of holding rates steady, with one voting for a cut. It was the first time since September 2021 that none of the committee members had voted for a hike, reflecting how far inflation has fallen from its 11%+ peak in 2022.

The Federal Reserve kept its policy rate target range at 5.25% - 5.5% this week, while substantially upgrading its economic growth forecasts. Crucially, it left its projections for a total of 75 basis points of rate cuts for 2024 unchanged. This was a reassuring signal for equity markets, which have grown stronger through 2024 on the expectation of a soft landing. 


All investment views are presented for information only and are not a personal recommendation to buy or sell. Past performance is not a reliable indicator of future returns, investing involves risk and the value of investments, and the income from them, may fall as well as rise and are not guaranteed. Investors may not get back the original amount invested.

Any views expressed are based on information received from a variety of sources which we believe to be reliable, but are not guaranteed as to accuracy or completeness by atomos. Any expressions of opinion are subject to change without notice.

Please navigate to a service or product page and add the document to your brochure to continue.

Name your brochure
Your details
Thank you!

Your brochure is on its way.

Brochure Confirmation - your brochure is on its way.

We hope you find this useful.

The value of investments and any income from them can fall and you may get back less than you invested.