Investors remain optimistic as Pfizer and Moderna both have asked for emergency authorization from authorities in Europe and the U.S, and as Fed Chairman Jerome Powell said efforts from the central bank to backstop credit markets in the spring had unlocked almost $2 trillion to support businesses and states.

November 2020 is likely to remain in history books. For investors, it was better to be in the market than out of it. The month of November brought several known indices back into positive territory in 2020, including the German DAX, the Dutch AEX or the US Dow Jones. But not yet the SMI, the STOXX Europe 600 or the CAC40. Each index has its own specificities.

This buoyant market creates new opportunities for investors. For a professional or individual investor, listed index funds (ETFs) provide exposure to virtually any market in the world, without being slavishly tied to their domestic index.

But some clever people have taken the concept even further. Indeed, why bother with equities they don't want in an index? Their answer is direct indexing, which was the subject of a long article this weekend at Bloomberg. Basically, investors with sufficient financial strength can directly hold most of the components of a broad index, while picking a few opportunities elsewhere. At the same time, they can even decide not to invest in certain stocks or themes.

This strategy allows to create a kind of flexible personal index, capable of integrating ESG constraints, for example. This strategy is very popular with a certain category of investors, since you still need a solid financial base to buy all the securities in an index in quantity. Its attractiveness in relation to ETFs is mainly reinforced by its fiscal aspect, of course, and this is what makes the technique popular among the wealthy. Direct indexing allows losses of shares sold in decline to be offset against the gains of others, which is impossible with a listed index fund. Wealth engineering specialists who promote these techniques believe that the tax gains more than compensate for the additional costs of implementing these customized strategies. This type of arrangement is of great interest to major asset managers who have already got their hands on several promising players in the sector.

For the average investor, direct indexation is not within reach. But it is finally close to the strategies implemented by many individuals, consisting in holding ETFs to benefit from the overall performance of the markets over the long term, accompanied by strong securities of conviction files. Fiscal engineering less.

Today, final PMI manufacturing indexes for the major economies are expected throughout the day. Also scheduled are German employment figures and the Euro-Zone November inflation estimate. In the United States, a parliamentary hearing of Jerome Powell and the manufacturing ISM will be the focus of attention.

Earlier today, the Bank of Australia left its rates unchanged, as expected. At the same time, the Chinese Caixin Manufacturing PMI index is stronger than expected at 54.9 points, while the final Japanese Manufacturing PMI index is also higher than expected, although in a contraction zone at 49 points.