Join Delaware Funds by Macquarie’s Co-Head of US Multisector Fixed Income, Daniela Mardarovici and Managing Director and Senior Fixed Income Strategist Paul Matlack, for a discussion about how to talk to clients about cash allocations.
A financial crisis, following the 5.50% hike in Fed funds and similar increases in all bond yields, is virtually inevitable.
A key measure of how much bond investors are compensated for holding long-term debt turned positive for the first time since June 2021, reflecting steep increases in longer-maturity Treasury yields.
While September has been a bit sloppy so far, will further weakness in October weigh on investor sentiment before the seasonally strong period begins?
A US government shutdown would have a cascading economic effect, beginning mildly and deepening over time as millions of workers go without salary, private contractors aren’t paid and consumer uncertainty grows over Washington’s dysfunction.
This stock market rally in the first half of 2023 was built on the back of technology stocks, as investors bet on a resilient US consumer and hype surrounding artificial intelligence to keep the shares soaring.
The stock market is buckling under the weight of a simple equation: cash earns more than equities.
The Fed sent a strong signal that interest rates will remain higher for longer, as our Franklin Templeton Fixed Income CIO Sonal Desai has long predicted. The Fed also started to acknowledge that the natural real rate of interest is higher than it thought.
Private infrastructure offers unique investment characteristics and potential diversification benefits for portfolio construction.
Investors have been increasingly allocating to various alternative investments. However, I don't see them as distinct assets deserving of allocations. As I discuss in my article below, I consider alternatives investment styles and as optional for portfolios as taste is for nutrition.
The Conference Board's Consumer Confidence Index® declined again in September, marking two consecutive months of decline. The index dropped to 103.0 from August's upwardly revised reading of 108.7. This month's reading was worse than expected, falling below the 105.5 forecast.
Home prices continued to trend upwards in July as the benchmark 20-city index rose for a fifth consecutive month. The S&P Case-Shiller Home Price Index revealed seasonally adjusted home prices for the 20-city index saw a 0.9% increase month-over-month (MoM) and a 0.1% increase year-over-year (YoY). After adjusting for inflation, the MoM was reduced to 0.4% and the YoY was reduced to -7.0%.
Investors that missed out on this year’s dizzying rally in Nvidia Corp. have an attractive entry point this month.
The Federal Housing Finance Agency (FHFA) house price index (HPI) continued its climb in July, coming in at 409.5. U.S. house prices increased by 0.8% from the previous month and by 4.6% from one year ago. After adjusting for inflation, the real index is up 0.8% month-over-month and up 3.4% year-over-year.
The aim of this series is to move beyond the simplistic example of goals that exist at a single point in the future to consider retirement, the most common purpose for long-term investing for an individual.
As the cross-asset sell-off engulfed Wall Street last week, hedge funds ramped up their bets against stocks while one measure of their market positioning plunged the most since the March 2020 crash.
To judge by recent history, a US government shutdown won’t be a huge event for the bond market. If anything, it could even provide a little short-term relief, since Treasuries usually rally when investors need somewhere to hide.
It might be hard to believe after the crypto winter of 2022, but monetary tightening by global central banks could be supportive of Bitcoin upside.
In many ways, 2023 continues to be the mirror image of 2022, with the most volatile assets being some of the best performers for much of the year.
Today, in a shock decision, the Bank of England (BoE) left its policy rate at 5.25% by the tightest possible majority vote of 5-4. All but one of 65 economists polled by Reuters had predicted that the BoE would raise the rate to 5.5%.
Wednesday’s Federal Reserve (Fed) decision to keep the federal funds rate unchanged wasn’t a surprise at all. Markets, as we argued last week, had predicted that the Fed was going to stay put and that is what it did.
The Northern Trust Economics team shares its outlook for major markets in the months ahead.
A balanced portfolio needs assets with strong return potential and those that may provide downside mitigation. We believe direct lending can deliver both—a potentially valuable feature, particularly in today’s uncertain market.
Energy and Gold Produces Face Increasing Pressures, Crimping Supply.
We started RBA in 2009 primarily because we thought the US stock market was entering one of the biggest bull markets of our careers. However, most investors did not agree with our bullishness. Now, risk aversion seems a thing of the past.
Investors think about companies as being either large or small. In between those extremes are midcaps. Based on historical performance and fundamentals, midcaps should command more attention.
A string of CPI readings heading in the right direction. A labor market and consumer that are still intact. All of the sudden, the recession consensus has given way to a soft landing. Learn what may be in store for the equity market.
The hit TV series “That 70s Show” aired from 1998 to 2006 and focused on six teenage friends living in Wisconsin in the late 70s.
Some seven weeks ago, hedge fund investor Bill Ackman laid out his rationale for shorting long-term US bonds, and I took exception.
Bond investors face the crucial decision of just how much risk to take in Treasuries with 10-year yields at the highest in more than a decade and the Federal Reserve signaling it’s almost done raising rates.
Consumer stocks, one of the brightest corners of the market this year, are about to lose their shine as risks build for the sector, according to Morgan Stanley’s Michael Wilson.
US small-cap and industrial stocks are dropping, typically signals of a recession, but in a year where equities have already beaten expectations some investors are dismissing the moves as little more than noise — for now.
Investment-grade credit is currently offering impressive yields, with relatively less risk than other fixed income sectors, according to Josh Lohmeier of Franklin Templeton Fixed Income. He makes a case for investing in the space today.
I, however, like all Kens, have always had a firm grip on the remote for 100% of the time but I decided to let her have her way just once.
Many of the speakers and attendees were bullish on the physical metal, pointing to gold’s resilience in the face of a very strong U.S. dollar and multiyear-high yields.
For many wealth advisors, workplace retirement plans are either a burden or an afterthought, according to John Kutz, National Retirement Plan Strategist at Franklin Templeton. He and his team explore why embracing these plans can benefit their practice, and their clients.
The Federal Reserve weighs the data while investors wonder: Is the rate-hike cycle over?
Call it another case of bad timing for Wall Street strategists. The group, historically known to have a bullish bent, spent most of this year saying US stocks would end lower in 2023. Instead, the S&P 500 Index rallied 16% in the first half.
Over the last 100 years, the US equity market has returned about 9% annually. What will it return over the next 100 years?
For the second time in four months, the central bank decided to not increase interest rates but indicated another hike in 2023 is likely.
The resilience of the world’s biggest bond market is top priority as US debt officials prepare to start buying back government debt, according to Josh Frost, the Treasury Department’s assistant secretary for financial markets.
While some stocks may seem expensive, there are areas of opportunity that feature attractive valuations and growth catalysts, according to the Franklin Templeton Investment Solutions team.
Treasury 10-year yields rose above 4.5% for the first time since 2007 as a more hawkish Federal Reserve adds to concern the bonds face a toxic mix of large US fiscal deficits and persistent inflation.
Many view growth stocks, including tech stocks, as sensitive to rising interest rates. Last year confirmed this thesis. That script has been flipped for the better this year as technology ranks as one of the best-performing groups in the S&P 500 despite multiple rate hikes by the Federal Reserve.
The yield on the 10-year note ended September 22, 2023 at 4.44%, the 2-year note ended at 5.10%, and the 30-year at 4.53%.
Given concentration risk, understanding what a strategy and portfolio owns is more important than ever in current markets.
Investment bankers were finally starting to believe in the green shoots of capital-markets activity this month, but the Federal Reserve might now have crushed them under hawkish boots.
Low interest rates can lead people to rationalize all sorts of bad ideas: investing in companies that will never make a profit, financing share buybacks with debt, spending billions on terrible streaming content, to name a few.
A bad week on Wall Street turned dismal Thursday after the relentless surge in Treasury yields sapped demand for risk assets. In the end, US stocks suffered the biggest drop in six months as investors recalibrate for a world where rates sit at levels not seen in a generation.
The weekly leading economic index (WLEI) is a composite for the U.S economy that draws from over 20 time-series and groups them into the following six broad categories which are then used to construct an equally weighted average. As of September 8th, the index was at 7.010, down .007 from the previous week.
ETF Trends interviewed three sources about active ETFs, why financial advisors are opting for these investment solutions for clients, and how these factors have changed in recent years. Each source responded to the same questions in their respective interviews.
The September Federal Reserve meeting provided few surprises, but ongoing uncertainty about the Fed's next move may mean more volatility ahead.
Existing home sales continued their downward trend in August as prices remained elevated. According to the data from the National Association of Realtors (NAR), existing home sales fell by 0.7% from July to reach a seasonally adjusted annual rate of 4.04 million units. This figure came in lower than the expected 4.10 million. Existing home sales are down 15.3% compared to one year ago.
The Conference Board Leading Economic Index (LEI) fell for the 17th consecutive month in August as economic uncertainty and recession fears continue to grow. The index dropped 0.4% from last month to 105.4, the index's lowest reading since June 2020.
The Federal Reserve’s internal debate about the “neutral” real rate of interest is heating up.
Bond traders are bracing for Treasury yields to keep pushing higher after the Federal Reserve signaled it’s likely to hold interest rates at lofty levels well into next year.
BlackRock Inc. and other money managers spent years rolling out sustainable funds, seeking to capitalize on surging interest in ESG investing. Now they’re abandoning an increasing number of those products in the US amid political backlash and investor scrutiny.
Can the economy grow 2.0% to 2.5% faster per year over the next 10 years than the last 30 years? I don't think so.
The European Central Bank is likely at or very near its peak policy rate, but we don’t expect rate cuts in the near term.
Inverted curves (when the gold line goes below the red line meaning that short maturity yields are higher compared to longer maturity yields) have preceded recessions.
The Franklin Templeton Fixed Income team believe that issuers that think critically about the environment in which they operate could outperform throughout the full market cycle compared with those who are slower to adapt.
Whatever stories Americans are told about the strength of the economy under President Joe Biden, they are not going to be persuaded to look past the issue of their own living standards. For most Americans, these have declined somewhat as price increases have outpaced wage growth.
Banks have reemerged as a potential pain point for the investment community, as rating agencies recently embarked on a downgrade cycle in the sector.
To widen your audience, deepen client bonds, and carve out a strong market presence, a webinar strategy is your ticket to success.
Consumers might still be benefiting from inflation pressures abating, but the same is no longer true for corporations.
US five- and 10-year yields rose to the highest levels since 2007 after hotter-than-anticipated inflation data in Canada and rising oil prices added to global concerns about resurgent price pressures.
For new investors, the world of finance can appear daunting. But among the sea of investment options, Treasury bonds (often just called “Treasuries”) are a pillar of stability and reliability.
Given the uncertainty over a recession, there are other incremental steps that investors may want to consider instead. These include making adjustments to a portfolio’s market beta and credit exposure.
A return to the Great Moderation Era looks unlikely, which might lead to an increasingly volatile—and somewhat unfamiliar—inflationary, economic, and geopolitical landscape.
In arguably quiet fashion, active managers are performing admirably in 2023. An impressive percentage of active equity and fixed income funds beat their benchmarks in the first half of the year.
Celebrating an exciting milestone: Franklin Income Fund turns 75. Learn more about this flagship strategy and read some fun facts from back in 1948.
The term “Bond Vigilantes” is a nostalgic twist on an old-west theme. In the nineteenth century, the American West formed self-appointed groups, or committees, to seize the duties of law enforcement and judicial authority in situations when citizens found law enforcement lacking or inadequate.
These days, high-yield US bonds yield just 378 basis points over Treasuries, more than 2 percentage points below the 2022 high and close to the narrowest gap since the Federal Reserve started raising interest rates last year.
Fifty cents on the dollar is a very low price in the world of bonds. In most cases, it signals that investors believe the seller of the debt is in such financial distress that it could default.
Have you ever wondered why your closing ratio on seminar attendees rarely exceeds 40%?
Now seems like a good time to talk about wrappers and which ones are best for different situations. How do you decide whether to use an ETF, a mutual fund, or something else?
When markets are in a rising tide, all boats (aka stocks) can benefit. When the waters are choppier, active equity selection aims to identify the sounder vessels. Tony DeSpirito reviews five reasons why he believes the new environment is setting up to favor an active approach.
The FOMC will make some close calls and tough decisions.
Confidence is returning to the bond markets and one sign is corporations’ willingness to start taking on debt again with new issuance.
Markets are convinced that the Federal Reserve (Fed) is going to pause its interest rate campaign after it finalizes its Federal Open Market Committee (FOMC) meeting on Wednesday, September 20.
Despite substantial growth and huge advancements in public policy support, clean energy has had an abysmal stretch in the stock market the last two and a half years.
The University of Colorado Buffaloes are undefeated and suck up a lot of oxygen in the college football world.
Rising interest rates are giving sellers an opportunity to broaden their opportunity set.
Managing volatility is a high priority for advisors. The right investments can stabilize a portfolio and dampen volatility, while keeping goals on track. Increasing bond allocations used to be the standard way to reduce volatility, but with bonds more correlated to equities, their diversification value has decreased. With high inflation, bonds also aren’t providing enough real income for many investors.
Demand for private credit has increased because of its low correlation to traditional equities and bonds, and enhanced income potential. As an asset class, private credit has a history of resiliency throughout economic downturns. That was true during the pandemic, and last year when these types of loans largely held up, in contrast to the bond market which had historically bad performance.
My guest today will discuss how advisors can reduce volatility, increase income and diversify equity and bond allocations through private credit and other alternatives.
Here’s how I apply behavioral finance to help clients to think differently about their investing.
Warren Buffett has advised investors to be fearful when others are greedy and greedy only when others are fearful. New research confirms Buffett’s admonition.
High mortgage rates continue to weaken builder confidence. The National Association of Home Builders (NAHB) Housing Market Index (HMI) fell 5 points from last month to 45, the index's second straight monthly decline.
Credit Research Analysts Greg Schantz and Julian Wellesley dive into why they favor European banks vs US banks and why they see a potential opportunity in Yankee bank bonds.
Economists are playing a game of “can-you-top-this this,” seeing who can ramp up their US economic growth forecasts the most.
Okay, I took a little poetic license, but the point is that while we try, predictions of the future are difficult at best and impossible at worst.
Fixed Income
Bonds are back: Time to move cash off the sidelines
Join Delaware Funds by Macquarie’s Co-Head of US Multisector Fixed Income, Daniela Mardarovici and Managing Director and Senior Fixed Income Strategist Paul Matlack, for a discussion about how to talk to clients about cash allocations.
The Looming Crisis: Who Is Swimming Naked?
A financial crisis, following the 5.50% hike in Fed funds and similar increases in all bond yields, is virtually inevitable.
Treasury ‘Term Premium’ Gauge Positive for First Time Since 2021
A key measure of how much bond investors are compensated for holding long-term debt turned positive for the first time since June 2021, reflecting steep increases in longer-maturity Treasury yields.
October Weakness Before The Year-End Run?
While September has been a bit sloppy so far, will further weakness in October weigh on investor sentiment before the seasonally strong period begins?
US Government Shutdown’s Economic Risks Grow the Longer It Lasts
A US government shutdown would have a cascading economic effect, beginning mildly and deepening over time as millions of workers go without salary, private contractors aren’t paid and consumer uncertainty grows over Washington’s dysfunction.
Tech Stocks That Drove Market Rally Are Now Down 10%
This stock market rally in the first half of 2023 was built on the back of technology stocks, as investors bet on a resilient US consumer and hype surrounding artificial intelligence to keep the shares soaring.
Wall Street Bets on High-Yielding Cash Deals in Fresh Blow to Stocks
The stock market is buckling under the weight of a simple equation: cash earns more than equities.
On My Mind: Restrictive? We’ll know it when we see it.
The Fed sent a strong signal that interest rates will remain higher for longer, as our Franklin Templeton Fixed Income CIO Sonal Desai has long predicted. The Fed also started to acknowledge that the natural real rate of interest is higher than it thought.
Unlisted Infrastructure – Highway to Diversification
Private infrastructure offers unique investment characteristics and potential diversification benefits for portfolio construction.
Treat Alternatives Like Cuisines, Not Distinct Assets
Investors have been increasingly allocating to various alternative investments. However, I don't see them as distinct assets deserving of allocations. As I discuss in my article below, I consider alternatives investment styles and as optional for portfolios as taste is for nutrition.
Consumer Confidence Declined Again in September
The Conference Board's Consumer Confidence Index® declined again in September, marking two consecutive months of decline. The index dropped to 103.0 from August's upwardly revised reading of 108.7. This month's reading was worse than expected, falling below the 105.5 forecast.
S&P Case-Shiller Home Price Index: Continues to Trend Upward in July
Home prices continued to trend upwards in July as the benchmark 20-city index rose for a fifth consecutive month. The S&P Case-Shiller Home Price Index revealed seasonally adjusted home prices for the 20-city index saw a 0.9% increase month-over-month (MoM) and a 0.1% increase year-over-year (YoY). After adjusting for inflation, the MoM was reduced to 0.4% and the YoY was reduced to -7.0%.
Nvidia’s Worst Month in a Year Is a Gift For Bulls
Investors that missed out on this year’s dizzying rally in Nvidia Corp. have an attractive entry point this month.
FHFA House Price Index Rises 0.8% in July
The Federal Housing Finance Agency (FHFA) house price index (HPI) continued its climb in July, coming in at 409.5. U.S. house prices increased by 0.8% from the previous month and by 4.6% from one year ago. After adjusting for inflation, the real index is up 0.8% month-over-month and up 3.4% year-over-year.
Long-Horizon Investing, Part 1: A Ton of Feathers
The aim of this series is to move beyond the simplistic example of goals that exist at a single point in the future to consider retirement, the most common purpose for long-term investing for an individual.
Hedge Funds Cut Stock Leverage at Fastest Pace Since 2020 Crash
As the cross-asset sell-off engulfed Wall Street last week, hedge funds ramped up their bets against stocks while one measure of their market positioning plunged the most since the March 2020 crash.
Bond Traders Roiled by Fed See US Shutdown as Next Big Wild Card
To judge by recent history, a US government shutdown won’t be a huge event for the bond market. If anything, it could even provide a little short-term relief, since Treasuries usually rally when investors need somewhere to hide.
Monetary Tightening Might Boost Bitcoin, Says Crypto Expert
It might be hard to believe after the crypto winter of 2022, but monetary tightening by global central banks could be supportive of Bitcoin upside.
As the Economy Slows, Favor Consistency Over Volatility
In many ways, 2023 continues to be the mirror image of 2022, with the most volatile assets being some of the best performers for much of the year.
Bank of England: A surprise end to UK rate hikes?
Today, in a shock decision, the Bank of England (BoE) left its policy rate at 5.25% by the tightest possible majority vote of 5-4. All but one of 65 economists polled by Reuters had predicted that the BoE would raise the rate to 5.5%.
The Match Continues: The Fed vs. The Market
Wednesday’s Federal Reserve (Fed) decision to keep the federal funds rate unchanged wasn’t a surprise at all. Markets, as we argued last week, had predicted that the Fed was going to stay put and that is what it did.
Global Economic Outlook: China Casts a Shadow in the East…and West
The Northern Trust Economics team shares its outlook for major markets in the months ahead.
Offense or Defense? Direct Lending Can Play Both
A balanced portfolio needs assets with strong return potential and those that may provide downside mitigation. We believe direct lending can deliver both—a potentially valuable feature, particularly in today’s uncertain market.
Biden Administration Expands War on Critical Natural Resources
Energy and Gold Produces Face Increasing Pressures, Crimping Supply.
Investors’ Shift From Fear to Greed Presents Historic Opportunities
We started RBA in 2009 primarily because we thought the US stock market was entering one of the biggest bull markets of our careers. However, most investors did not agree with our bullishness. Now, risk aversion seems a thing of the past.
The Compelling Opportunity in Midcaps
Investors think about companies as being either large or small. In between those extremes are midcaps. Based on historical performance and fundamentals, midcaps should command more attention.
The Soft Landing Consensus
A string of CPI readings heading in the right direction. A labor market and consumer that are still intact. All of the sudden, the recession consensus has given way to a soft landing. Learn what may be in store for the equity market.
“That 70s Show”
The hit TV series “That 70s Show” aired from 1998 to 2006 and focused on six teenage friends living in Wisconsin in the late 70s.
Ackman Doubles Down on Bond Short That’s Still Flawed
Some seven weeks ago, hedge fund investor Bill Ackman laid out his rationale for shorting long-term US bonds, and I took exception.
Bond Market Faces Quandary After Fed Signals It’s Almost Done
Bond investors face the crucial decision of just how much risk to take in Treasuries with 10-year yields at the highest in more than a decade and the Federal Reserve signaling it’s almost done raising rates.
Morgan Stanley’s Wilson Sees Risks Rising for US Consumer Stocks
Consumer stocks, one of the brightest corners of the market this year, are about to lose their shine as risks build for the sector, according to Morgan Stanley’s Michael Wilson.
Stocks Flash Recession Warning as Trouble Spreads to Industrials
US small-cap and industrial stocks are dropping, typically signals of a recession, but in a year where equities have already beaten expectations some investors are dismissing the moves as little more than noise — for now.
Opportunity in Investment-Grade Credit
Investment-grade credit is currently offering impressive yields, with relatively less risk than other fixed income sectors, according to Josh Lohmeier of Franklin Templeton Fixed Income. He makes a case for investing in the space today.
Call Me Ken
I, however, like all Kens, have always had a firm grip on the remote for 100% of the time but I decided to let her have her way just once.
Why Junior Gold Stocks Could Be Gearing Up For A Glittering Performance
Many of the speakers and attendees were bullish on the physical metal, pointing to gold’s resilience in the face of a very strong U.S. dollar and multiyear-high yields.
Workplace Retirement Voice: Why Wealth Advisors Should Embrace Workplace Retirement Plans
For many wealth advisors, workplace retirement plans are either a burden or an afterthought, according to John Kutz, National Retirement Plan Strategist at Franklin Templeton. He and his team explore why embracing these plans can benefit their practice, and their clients.
Quarterly Market Outlook: A Delicate Balance
The Federal Reserve weighs the data while investors wonder: Is the rate-hike cycle over?
Wall Street Strategists Turn Ever Bullish Just as Stocks Slump
Call it another case of bad timing for Wall Street strategists. The group, historically known to have a bullish bent, spent most of this year saying US stocks would end lower in 2023. Instead, the S&P 500 Index rallied 16% in the first half.
The Next 100 Years
Over the last 100 years, the US equity market has returned about 9% annually. What will it return over the next 100 years?
Fed Elects To Skip Rate Hike at September 2023 FOMC Meeting
For the second time in four months, the central bank decided to not increase interest rates but indicated another hike in 2023 is likely.
Treasury Buyback Plan Will Boost Market Resilience, US Debt Official Says
The resilience of the world’s biggest bond market is top priority as US debt officials prepare to start buying back government debt, according to Josh Frost, the Treasury Department’s assistant secretary for financial markets.
Where to Add Risk in Multi-Asset Portfolios Right Now
While some stocks may seem expensive, there are areas of opportunity that feature attractive valuations and growth catalysts, according to the Franklin Templeton Investment Solutions team.
Another Yield High as US 10-Year Jumps Above Key 4.5% Level in Post-Fed Bond Rout
Treasury 10-year yields rose above 4.5% for the first time since 2007 as a more hawkish Federal Reserve adds to concern the bonds face a toxic mix of large US fiscal deficits and persistent inflation.
Higher Rates Might Not Dent Tech Stocks
Many view growth stocks, including tech stocks, as sensitive to rising interest rates. Last year confirmed this thesis. That script has been flipped for the better this year as technology ranks as one of the best-performing groups in the S&P 500 despite multiple rate hikes by the Federal Reserve.
Treasury Yields Snapshot: September 22, 2023
The yield on the 10-year note ended September 22, 2023 at 4.44%, the 2-year note ended at 5.10%, and the 30-year at 4.53%.
The Importance of Valuations in High Concentration Markets
Given concentration risk, understanding what a strategy and portfolio owns is more important than ever in current markets.
Did Powell Just Stamp Out Bankers’ Green Shoots?
Investment bankers were finally starting to believe in the green shoots of capital-markets activity this month, but the Federal Reserve might now have crushed them under hawkish boots.
Private Equity Won’t Diversify Your Portfolio
Low interest rates can lead people to rationalize all sorts of bad ideas: investing in companies that will never make a profit, financing share buybacks with debt, spending billions on terrible streaming content, to name a few.
Stocks Sink Most in Six Months After Recent Runup in Treasury Yields
A bad week on Wall Street turned dismal Thursday after the relentless surge in Treasury yields sapped demand for risk assets. In the end, US stocks suffered the biggest drop in six months as investors recalibrate for a world where rates sit at levels not seen in a generation.
RecessionAlert Weekly Leading Economic Index
The weekly leading economic index (WLEI) is a composite for the U.S economy that draws from over 20 time-series and groups them into the following six broad categories which are then used to construct an equally weighted average. As of September 8th, the index was at 7.010, down .007 from the previous week.
The Rise of Active ETFs: 3 Experts Weigh In
ETF Trends interviewed three sources about active ETFs, why financial advisors are opting for these investment solutions for clients, and how these factors have changed in recent years. Each source responded to the same questions in their respective interviews.
Fed Pauses but Projects One More Hike This Year
The September Federal Reserve meeting provided few surprises, but ongoing uncertainty about the Fed's next move may mean more volatility ahead.
Existing Home Sales Fall as Prices Rise
Existing home sales continued their downward trend in August as prices remained elevated. According to the data from the National Association of Realtors (NAR), existing home sales fell by 0.7% from July to reach a seasonally adjusted annual rate of 4.04 million units. This figure came in lower than the expected 4.10 million. Existing home sales are down 15.3% compared to one year ago.
CB Leading Economic Index Declines, Deepening Recession Fears
The Conference Board Leading Economic Index (LEI) fell for the 17th consecutive month in August as economic uncertainty and recession fears continue to grow. The index dropped 0.4% from last month to 105.4, the index's lowest reading since June 2020.
Fed’s Debate About ‘Neutral’ Is Mostly an Exercise
The Federal Reserve’s internal debate about the “neutral” real rate of interest is heating up.
Bond Traders See Yields Marching Higher After September Fed Meeting
Bond traders are bracing for Treasury yields to keep pushing higher after the Federal Reserve signaled it’s likely to hold interest rates at lofty levels well into next year.
BlackRock, State Street Among Money Managers Closing ESG Funds
BlackRock Inc. and other money managers spent years rolling out sustainable funds, seeking to capitalize on surging interest in ESG investing. Now they’re abandoning an increasing number of those products in the US amid political backlash and investor scrutiny.
This Time is Not Different. Yields are Too High
Can the economy grow 2.0% to 2.5% faster per year over the next 10 years than the last 30 years? I don't think so.
ECB Prioritizes Fighting Inflation Above Avoiding Recession
The European Central Bank is likely at or very near its peak policy rate, but we don’t expect rate cuts in the near term.
To the Point!
Inverted curves (when the gold line goes below the red line meaning that short maturity yields are higher compared to longer maturity yields) have preceded recessions.
Weathering the Storm: Exploring Climate Change Adaptation and the Investor’s Imperative
The Franklin Templeton Fixed Income team believe that issuers that think critically about the environment in which they operate could outperform throughout the full market cycle compared with those who are slower to adapt.
Down on the Biden Economy
Whatever stories Americans are told about the strength of the economy under President Joe Biden, they are not going to be persuaded to look past the issue of their own living standards. For most Americans, these have declined somewhat as price increases have outpaced wage growth.
Do We Really Need to Be Worried About the Banking Sector?
Banks have reemerged as a potential pain point for the investment community, as rating agencies recently embarked on a downgrade cycle in the sector.
Boost Client Engagement and Growth with Webinars
To widen your audience, deepen client bonds, and carve out a strong market presence, a webinar strategy is your ticket to success.
Inflation or Recession? CEOs Will Decide Next Month
Consumers might still be benefiting from inflation pressures abating, but the same is no longer true for corporations.
Treasury Yields at Highest Levels Since 2007 on Price Concerns
US five- and 10-year yields rose to the highest levels since 2007 after hotter-than-anticipated inflation data in Canada and rising oil prices added to global concerns about resurgent price pressures.
The ABCs of Treasury Bonds
For new investors, the world of finance can appear daunting. But among the sea of investment options, Treasury bonds (often just called “Treasuries”) are a pillar of stability and reliability.
A Recession Is Possible, but Far From Certain. So How Should You Consider Positioning Your Portfolio?
Given the uncertainty over a recession, there are other incremental steps that investors may want to consider instead. These include making adjustments to a portfolio’s market beta and credit exposure.
Say Goodbye…to Great Moderation?
A return to the Great Moderation Era looks unlikely, which might lead to an increasingly volatile—and somewhat unfamiliar—inflationary, economic, and geopolitical landscape.
Assessing Allure of Active Management
In arguably quiet fashion, active managers are performing admirably in 2023. An impressive percentage of active equity and fixed income funds beat their benchmarks in the first half of the year.
A Pioneering Income Strategy Celebrates 75 Years
Celebrating an exciting milestone: Franklin Income Fund turns 75. Learn more about this flagship strategy and read some fun facts from back in 1948.
Bond Vigilantes And The Waiting For Godot
The term “Bond Vigilantes” is a nostalgic twist on an old-west theme. In the nineteenth century, the American West formed self-appointed groups, or committees, to seize the duties of law enforcement and judicial authority in situations when citizens found law enforcement lacking or inadequate.
Bond Mountaineers Easily Scale the Maturity Wall
These days, high-yield US bonds yield just 378 basis points over Treasuries, more than 2 percentage points below the 2022 high and close to the narrowest gap since the Federal Reserve started raising interest rates last year.
Sub-50 Cent Price on Treasury Bond Underscores Investor Pain
Fifty cents on the dollar is a very low price in the world of bonds. In most cases, it signals that investors believe the seller of the debt is in such financial distress that it could default.
How Pre-Screening Avoids “Plate Lickers” at Seminars
Have you ever wondered why your closing ratio on seminar attendees rarely exceeds 40%?
VettaFi Voices On: Choosing Your Wrapper
Now seems like a good time to talk about wrappers and which ones are best for different situations. How do you decide whether to use an ETF, a mutual fund, or something else?
5 Factors Favoring Stock Selection
When markets are in a rising tide, all boats (aka stocks) can benefit. When the waters are choppier, active equity selection aims to identify the sounder vessels. Tony DeSpirito reviews five reasons why he believes the new environment is setting up to favor an active approach.
Fed Preview: Done, Or More To Be Done?
The FOMC will make some close calls and tough decisions.
Get Active Exposure as Corporate Confidence Returns in Bonds
Confidence is returning to the bond markets and one sign is corporations’ willingness to start taking on debt again with new issuance.
To Increase or Not to Increase: That Is the Question
Markets are convinced that the Federal Reserve (Fed) is going to pause its interest rate campaign after it finalizes its Federal Open Market Committee (FOMC) meeting on Wednesday, September 20.
Turbulence on the Path to Transformation
Despite substantial growth and huge advancements in public policy support, clean energy has had an abysmal stretch in the stock market the last two and a half years.
Higher Rates & A Shutdown On The Menu
The University of Colorado Buffaloes are undefeated and suck up a lot of oxygen in the college football world.
Seller Financing of Real Estate is Back
Rising interest rates are giving sellers an opportunity to broaden their opportunity set.
The Outlook for Alternative Investments
Managing volatility is a high priority for advisors. The right investments can stabilize a portfolio and dampen volatility, while keeping goals on track. Increasing bond allocations used to be the standard way to reduce volatility, but with bonds more correlated to equities, their diversification value has decreased. With high inflation, bonds also aren’t providing enough real income for many investors.
Demand for private credit has increased because of its low correlation to traditional equities and bonds, and enhanced income potential. As an asset class, private credit has a history of resiliency throughout economic downturns. That was true during the pandemic, and last year when these types of loans largely held up, in contrast to the bond market which had historically bad performance.
My guest today will discuss how advisors can reduce volatility, increase income and diversify equity and bond allocations through private credit and other alternatives.
How I Apply Behavioral Finance to Achieve Better Client Outcomes
Here’s how I apply behavioral finance to help clients to think differently about their investing.
Buffett was Right About Sentiment and the VIX as Predictors of Returns
Warren Buffett has advised investors to be fearful when others are greedy and greedy only when others are fearful. New research confirms Buffett’s admonition.
NAHB Housing Market Index: Builder Confidence Weakened by High Mortgage Rates
High mortgage rates continue to weaken builder confidence. The National Association of Home Builders (NAHB) Housing Market Index (HMI) fell 5 points from last month to 45, the index's second straight monthly decline.
Shifting Trends Favor European Banks vs. US Banks for the First Time in Years
Credit Research Analysts Greg Schantz and Julian Wellesley dive into why they favor European banks vs US banks and why they see a potential opportunity in Yankee bank bonds.
Bidenomics Is Having an Unusual Effect on Deficits
Economists are playing a game of “can-you-top-this this,” seeing who can ramp up their US economic growth forecasts the most.
Predictions Are Pointless. Why You Shouldn’t Listen To Gurus.
Okay, I took a little poetic license, but the point is that while we try, predictions of the future are difficult at best and impossible at worst.