With drifting markets, the debate over whether the time is ripe to enter stock markets or sit on the fence has become the order of the day - between as well as within investment firms.

GLG Partners’ Jamil Baz, chief investment strategist, and Ben Funnell, chief equity strategist, have different views on the investment opportunities ahead. The former argues that it is not worth the risk to invest in stocks, while the latter believes that it could be dangerous for investors to be short risk in the current environment.

According to Baz, even if Europe is the most urgent issue, the real problem that needs to be addressed is leverage. He thinks that the US will experience at least 15 years of sub-par economic growth, as the country needs to get its total debt down from today’s 350 per cent of GDP, the same level as in 2007, to below 200 per cent.

Deleveraging and reduced spending mean that the US and much of the developed world are hurtling towards a Japanese scenario with decades of lost growth, said Baz.

Funnell agrees that the macro outlook looks very bleak and should not be underestimated, but thinks that there will be opportunities in the short term. For example, simultaneous quantitative easing on the part of the Bank of England, the Federal Reserve, the Bank of Japan, the Swiss National Bank and the European Central Bank could push up equity prices.

Although economic stimulus does not address the structural problems of the world economy, Funnell says that it can have a major cyclical impact. He stresses Japan’s Nikkei index, which despite being in the doldrums for more than 20 years, has seen four rallies exceeding 50 per cent in magnitude during that period. According to Funnell, three of them were driven by the government’s reflation policies and one of them led to a hike of almost 120 per cent.

GLG Partners is a UK subsidiary of Man Group, the largest listed hedge fund firm in the world.