The end of 2016 through the beginning of 2018 had been one of the least volatile periods in recorded stock market history. It was THE least volatile by one measure – for the 404 trading days through the beginning of February, the market never had a five percent correction – the longest streak on record.

Recent oil/commodity market rallies created an extra month of “apparent demand” down the major value chains, as buyers added inventory ahead of expected price increases for their own raw materials. In turn, this created the illusion of a synchronized global recovery – but reality will now intrude as the rallies end.

Last week’s carnage in the US stock markets was one of the worst meltdowns I have witnessed in my 40+ years in the investment business. Most US stock indexes plunged over 10% in value from Friday, February 2 to the lows on Friday, February 9 – complete with two days where the Dow Jones Industrial Average lost over 1,000 points in one session.

Last week’s turbulence shined a harsh spotlight on the stock market. Appropriately so, if that’s where your investments are. But in the hubbub many investors are missing the deeper and far more urgent bond market issues.

Volatility has spiked, jolting investors out of complacency, but that doesn’t mean any dramatic action is needed.

We believe that a multi-asset investing approach is instrumental to navigating today’s market volatility. Here’s how it’s working for us.

It seems that after years of expecting inflation to rise to its 2.0% target the Federal Reserve and many
economists have concluded it’s just not possible. The reasons most often cited are the Amazon Affect,
Artificial Intelligence, weak wage growth, years of excess capacity, and transitory factors like the mobile phone price war in March 2017.

With the dramatic spike in market volatility over the past week, many investors are asking what comes next.

The financial advisory industry is full of handy insights when it comes to web design. The slightest difference, even if it’s not clearly visible, can be a game changer in such a competitive industry.

Stocks are most vulnerable when optimism is at an extreme and its long-term trend reverses. This is when careless investment decisions are exposed, as well. Right now, the P/E is well above its 48-month MA and secondary up trendline, and is showing no signs of weakness.

The macro data from the past month continues to mostly point to positive growth. On balance, the evidence suggests the imminent onset of a recession is unlikely.

In what was Janet Yellen’s final meeting as Fed Chair, rates were left unchanged, but the outlook for inflation was elevated in the statement.

In his best-selling book “One up on Wall Street” Peter Lynch included this subtitle on his cover: “How to use what you already know to make money in the stock market.” And later in the book he talks about “the power of common knowledge.” Stating it over simplistically, Peter Lynch often talked about getting his best ideas from observing his family’s shopping habits.

With President Trump scheduled to give the annual State of the Union address tonight, I thought it would be a good time to consider the economic state of the union. As usual, of course, I am going to pass on the politics and instead take a big-picture look at the economy.

Last week, we reviewed the development of nuclear weapons and US deployment policy from the end of WWII to the end of the Cold War. We analyzed how the theory of deterrence developed and introduced events of the post-Cold War era. This week, we discuss how Cold War arrangements have broken down in the post-Cold War world and the ensuing nuclear proliferation.

One of the prisms through which we analyze market and manager performance is that of common risk factors. A risk factor is a characteristic that is common to a broad universe of stocks that has three primary attributes...

One of the dominating economic headlines of late has been the weakness of the dollar. These stories have been exacerbated by Treasury Secretary Steven Mnuchin’s comment that the “dollar is not a concern of mine.”

Disruption was definitely top of mind during many of the presentations and interviews at Inside ETFs, including that of producer and composer Quincy Jones, who was at the conference to promote a new stock index that tracks music and entertainment companies

Impactful innovation only occurs when OCIO providers work as true fiduciaries. We believe there are four OCIO innovations in particular that meet this bar.

Since the high yield bond market lows in mid-November, prices recovered and have now moved somewhat above the late-October highs. This process has been slow—and we remained suspect that an intermediate-term trend had not been established.

Many investors think that this bull market and economic expansion have gone on long enough and a bear market and a recession will take place soon. In my view, we have at least a year or two before the next major downturn in either the market or the economy, barring a major geopolitical conflict such as a shooting war with North Korea, Russia or Iran.

Years ago we published a report on nuclear war and civil defense. Since then, we have seen an increase in actual and potential nuclear proliferation. Recent US administrations have reviewed their policies on nuclear weapons and we are seeing a departure from the late Cold War thinking on nuclear policy.

For many years now, investing in healthcare related stocks has presented me with a conundrum of sorts. Demographic forces, primarily the graying of America (and the world for that matter), suggests powerful future growth potential and demand for healthcare related products and services. On the other hand, healthcare and its costs have long been a political hotbed.

Fixed income exchange-traded funds (ETFs) saw a record $126 billion of inflows in 2017, bringing the overall market to nearly $600 billion. The majority of these flows, as well as existing assets under management, are in passive bond ETFs. But are passive, index-tracking approaches the best way to harness the fixed income opportunity set?

In this far-reaching interview, Jack Bogle comments on the future of index funds, argues that the value premium has been arbitraged away and attacks publicly-held mutual fund companies.

We have all been taught to “play by the rules” since the very beginning of our lives. Our parents did the best they could to teach us rules of proper behavior. That list of rules continued to grow longer the older we got, governing our day to day interactions with others.

Learn why the U.S. financial sector may be poised for growth in 2018.

Whatever business you might be in, you’ll probably agree with me that a critical key to your success is sales. Of course, you need great product, great team members and grit. But with great product and no sales… No success.

The constructive conditions for the US economy remain in place, in our view, in keeping with an increasingly solid expansion across the rest of the world. US consumers have been benefiting from an economy that appears close to full employment and a stock market at record levels, while a vibrant corporate sector has been buoyed further by recent tax changes.

One of the most important discoveries in finance over the past few decades is that stocks of firms that share certain fundamental characteristics called “factors” exhibit different return and risk characteristics than the overall market.

In the fall of 1981, the twenty-year US bond yield peaked slightly above 15% and has been zig zagging down through each successive business cycle since. During the last one hundred and sixty-years or so, the average secular, (very long-term) trend in rates has lasted around twenty seven-years. After thirty five-years of declining rates, the current secular bear is getting long in the tooth. 

As the new year begins to unfold, the environment for risk assets is still benign: the global economy is strong, monetary policy is accommodative, and volatility is low and steady. At this point, we don’t see excesses developing that could change that.

Yesterday, I noted briefly that I would be “keeping an eye” on how long the good times last in the new year. It was one of those offhand comments that, once you think about it, really requires quite a bit more thought and analysis than at first glance.

Despite the near non-stop drama of the legislative process, we ended December with the Tax Cut and Jobs Act of 2017 being signed into law. What does this mean for fixed income investors? In my opinion, the news is overwhelmingly positive for the US investment grade market; here are four reasons why.

I introduce an investment benchmark that simplifies the tracking process toward goals, which if achieved, provide certitude that one’s long-term objectives will be met.

Challenging conventional wisdom is a mainstay of financial conference speakers. I have seen few do so as effectively as Dylan Grice, who dismissed three mainstays of accepted beliefs, most notably that the value premium will deliver risk-adjusted outperformance.

At a time when equity valuations are at historic highs, increasing exposure means increasing risk. We believe there are better approaches that may help deliver a portfolio's required returns.

Invesco Fixed Income’s macro factor framework provides an understanding of how developments in growth, inflation and financial conditions globally are likely to impact markets.

Economists have endless debates about whether culture or institutions lie at the root of economic performance. But there is every reason to be concerned that the recent wave of populism is a threat to both.

Equity markets have enjoyed an exceptionally long spell of rising prices but, as we all know, it won't go on forever. Here are five reasons why the party may soon be over. Many would probably expect recession to be one of those five, but it isn't. The economic outlook is simply too good for me to add that to my list of main risks for 2018, but that doesn't mean equities cannot fall. Enjoy the read.

It is worth examining the nature of bubbles and the arguments that cryptocurrencies are in a bubble to determine whether the space is still worthy of investment.

Have profit margins risen to a permanently higher plateau? Are average Americans better off than they were a generation ago? I had the opportunity to discuss those questions, which are centrally important to investing and economic policy, with Jeremy Grantham a couple of weeks ago.

2017 was supposed to be the year that would put an end to modest growth, lukewarm inflation and anemic bond yields. It didn’t live up to the hype. But pressures are building, and that means volatility ahead—as well as opportunity.

This week and next we’ll look at forecasts from some of my most trusted friends and colleagues.

I believe these forces behind the fear trade will only intensify in 2018. With inflation finally showing green shoots and President Donald Trump’s $1.5 trillion tax reform law expected to increase deficit spending, this year could provide the right conditions to spur gold prices higher.

The fourth quarter of 2017 closely resembled much of the first three quarters – global markets continued to grow steadily, resulting in positive returns for many strategic domestic and global equity investors.

John Hathaway, manager of the Tocqueville Gold Fund (TGLDX) writes in his Q4 investor letter that “cryptocurrencies attempt to mimic one of the key attributes of gold: a liquid real asset with no counterparty risk. We view cryptocurrencies as contributors, and possibly as accelerants, to the long-term undermining of all paper currencies. We see them as allies of gold and threats to fiat currency, not as an existential threat to the metal, as they have been so frequently portrayed.”

Equity investors in search of higher returns are increasingly turning to factor investing. Driving this trend is frustration with the underperformance and higher fees of traditional active equity approaches, along with a growing realization that many stock-picking strategies owe their results largely to the manager’s factor tilts rather than stock-specific risk. 

Our stable of investment strategies at HWM has never been more diversified than it is today. In the last few years, we have significantly expanded the scope of the investments we recommend, including several successful strategies that do not involve stocks or bonds.