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tech and telecom were the best‐performing sectors

we highlight the lessons from the dotcom period (second only to today’s record

the potential massive alpha opportunity can be substantially

over the next 24 months global utilities rise by 38% on an absolute basis and outperform the global

each time the sector’s underweighting reaches 1 standard deviation below the

the sector becomes poised for extended outperformance rallies. This results from

when combined with wholesale shorts and market

it is not unusual to find long and/or sharp periods of utility underperformance (as

to add high‐beta stocks and shed low‐growth utilities. This was exacerbated by:

the current period of global utility underperformance is the deepest (‐67%) and

and Asian utilities such as Kunlun Energy and ENN Energy

along with equipment providers such as ABB (Switzerland).

National Grid (UK) and Elia (Belgium/Germany) are prime beneficiaries of this transmission

by enabling the delivery of the most efficient generation to meet demand. Many

transmission spending is accelerating in Europe (Germany

and utility capex (ex‐US) is rebounding after a recession‐driven

a turn in trend will be very supportive of higher share prices.

with new petrochemical plants being proposed in the Gulf and traditional coal users such as

we see the potential for LNG exports to exceed another 6 bcf/d (27 bcf/d of

currently‐planned US coal plant retirements