In this issue: Equity market volatility exhibits an inverse relationship with stock/bond correlation. This is a benefit to managed risk funds; As a result of ongoing low volatility, managed risk funds have generally implemented their respective maximum equity allocations for most of 2017; and market-based measures.
Adam Butler introduces a simple but novel innovation for modeling equity market valuations. There are reasons to believe average valuations should rise through time in response to changes in market structure. We discuss the conditions that might lead to higher valuations through time, and present a model to account for it.
After stumbling out of the gate, a 2.5% rally in the second half of April left the broad-market S&P 1500 1% higher on the month.
Managing Director, Investment Practice Adam Goff believes that an investment strategy, when dynamically managed, using cycle, value and sentiment as a way to examine opportunities, is more likely to help investors achieve their intended outcome.
The stock market started off this year in a similar fashion to how it ended last year, in rally mode. The difference this year is that international stocks have been participating as well.
Advisors should define risk as the probability that clients won’t meet their financial goals. Advisors should have the singular objective of minimizing this risk. This definition profoundly shifts the conversation away from volatility and losses, and toward strategies that achieve minimum required returns.
North American equities led the way in 2016, providing double digit returns and bolstering investor confidence. As expected, the recent strength has naively led investors to flock into US equity funds in what may possibly be the tail end of US equity dominance over global equity markets.
I’m starting to feel like a rancorous curmudgeon, but I am frustrated by some of the misguided commentary on asset allocation and how diversification is a myth.
Factors ranging from China’s evolving economy to the rise of nationalism combined to make 2016 a year that will not be quickly forgotten.
Donald Trump’s largely unexpected victory of the U.S. presidential election echoed the Brexit vote of just six months prior, reinforcing an ongoing fundamental shift in political currents and capital markets around the globe.