Recent volatility has created opportunities to invest in high yielding leveraged credit closed-end funds trading at a discount to net asset value.
How swift will the high-yield recovery be? How likely is it to be sustained? History sheds some light.
The fourth quarter of 2018 proved to be one of the most negative quarters for financial risk assets since the current bull market began in March of 2009. The S&P 500 finished down 13.5% and commodities were down an even worse 22.6%. As one might expect, safe haven assets performed well.
FIS Group, a manager of U.S. and global developed, emerging and frontier market equity portfolio strategies, issued its Q1 2019 Market Outlook, which provides a review of a tumultuous market in 2018 and offers predictions for what is to come in the year ahead.
Brandes believes increased market volatility and valuation readjustments in the final quarter of 2018 mean a better outlook for a global value investing approach in 2019 and beyond.
Wary investor sentiment, seasonal trading activity in loans, and a big institutional seller have combined to drive down loan prices over the last few weeks. The press has been all over this, using covenant-lite and loan-only narratives with which we disagree. We don’t see a sensational story here. The recent decline was mostly due to technical factors amplifying global macroeconomic worries.
Corporate profits and economic growth remain positive, but are past their peak. Investors may soon find that reaching the summit was the easy part. The real challenges occur in the climb down. Chief Investment Strategist Michael Arone, CFA and Head of SPDR® Americas Research Matthew Bartolini, CFA present three strategies to position for a market with potentially more downside than upside.
As 2018 comes to a close, it is a great time to discuss clients’ charitable giving strategies for next year and beyond.
Global markets are jittery as we start the new year with the same volatility drivers in place as last year. In our view, it's time for your clients to expect and prepare for periodic bouts of volatility.
Despite any positive economic signals, investors are anxiously eyeing a host of issues that could slow global growth -- and tilt the markets in a new direction.
Which issues are most critical to consider going into the new year? And what could be the consequences for the markets, both here and abroad? Read our annual outlook.
Investors’ obsession with the flattening U.S. Treasury yield curve dominated headlines for much of 2018. A flattening yield curve occurs when short-term rates are rising faster than long-term rates, which may eventually lead to an inverted yield curve, where short-term rates are higher than long-term rates. Historically, this has been a negative signal for the U.S. economy, often providing an early warning of an eventual recession, which is why the yield curve has been garnering so much attention recently.
-Global market performance remained challenged amid lingering volatility. -Concerns about softer growth, coupled with comments from the Fed, tempered market expectations for the path of future rate hikes. -An assortment of geopolitical developments continued to capture attention in November.
A brief monthly update on what's happening in the municipal bond market.
Bond investing is going digital. Find out how fixed-income managers who are integrating technology into their processes will be able to move from great ideas to executed trades faster and with better results than those who stick with the analog status quo.
In our 2019 Fixed Income Outlook, Matthews Asia's fixed income team discusses possible tailwinds for Asia bonds ahead.
As forces ranging from rising rates to trade disputes have raised the stakes for global markets and investors, our investing leaders step back for big-picture views of what these may portend for equity, fixed income, and real assets and other alternative markets.
Our senior investment leaders see plenty of reasons to be optimistic about the year ahead, but recognize investment opportunities may be more divergent.
The Federal Reserve is in the midst of an historic tightening cycle, and it has begun to impact the economy.
When a stock index falls by more than 10%, it is often said to have entered “correction” territory. That’s a fairly neutral term for what feels like a nerve-wracking drop to many investors. What does a correction mean? What’s likely to happen after a correction, and what can you do to help your portfolio weather the downturn?
When it comes to creating alpha, fixed-income managers that stay ahead of rapidly evolving technology will have an advantage over those that remain stuck in the analog world. But how do you assess how well your manager is navigating the changing technological landscape?
Preparing for the market turbulence that typically occurs in the run up to a recession.
Volatility returned and pulled markets across the globe into the red. Slowing growth momentum outside the U.S. further weighed on sentiment. Political developments from Latin America to Europe were a source of both uncertainty and assurance for markets.
The sweeping tax overhaul signed by President Donald Trump this year has many positive aspects for investors, while also creating both opportunities and challenges for financial advisors who use tax-efficient strategies.
Market Updates from across the region.
When it comes to US high-yield bank loans, we don’t mince words: we think the risk rarely justifies the potential reward.
October brought a significant increase in market volatility and a broad equity sell-off to match the late-January through early-February move lower.
Invesco research reveals a disconnect between market expectations and portfolio allocations in market-cap-weighted funds.
2017 shattered giving records. Strong markets and the prospect of tax reform drove total charitable giving past $400 billion for the first time ever. Grants in fiscal year 2018 reached $1.9 billion at Schwab Charitable, one of the largest national providers of donor-advised funds and other philanthropic services, where nearly 76% of account assets are associated with a financial advisor.
Our Recession Probability Model and Recession Dashboard continue to suggest a recession is likely to begin in early 2020. Investors ignore the yield curve’s signal at their peril.
October has lived up to its reputation as a volatile month as concerns about rising US interest rates, slowing growth in China and upcoming US midterm elections have spooked many investors. Franklin Equity Group offers a few words on the recent turmoil, why volatility can unlock compelling opportunities and why the investment team still sees a compelling case for technology companies.
Steve and Bryce dissected US Treasury bonds, discussing the message of the rates market and how this is directing asset allocation.
Change is good, but some things shouldn’t—and one of those is quarterly publication of my overview of the economy and the markets. I always like to start this commentary with an overview of the economy, as most stock market events are driven by economic events.
Our forecasts continue to favor emerging markets in both the equity and credit markets, says GMO Asset Allocation team member John Thorndike. As of the end of September, the spread between our forecasts for emerging markets equities and large cap U.S. stocks was nearly 8.5%. You have to go back to 2003 to find a wider spread in favor of EM.
There has been a lot of talk this year about the flattening of the US yield curve—which is a graphical representation of the spread between short- and long-term interest-rate instruments.
With the Federal Reserve (Fed) now targeting 2.00–2.25 percent on fed funds, tightening monetary policy is putting increasing pressure on corporate borrowers’ balance sheets across the leveraged credit landscape. We estimate that about 30–50 percent of the increase in short-term borrowing costs to date has passed through to the cost of debt for leveraged credit, depending on sector, and we expect this passthrough to increase over the next 12 months as the Fed raises rates.
Market updates from across the region.
While President Trump often cites the massive trade deficit with China, the real issue in U.S.-China trade relations is not the headline number but the government policies that distort competition, including subsidizing state-owned enterprises, requiring technology transfers, constricting market access in certain industries, and even manipulating the yuan.
US Treasury yields have risen in response to strong economic growth. In the first week of October, the yield on the 10-year bond surged to its highest level in more than seven years. The question is: Do yields have more room to run?
As major U.S. stock indices hit new all-time highs, one of the key uncertainties is whether the House, the Senate, or both could flip to the Democrats on Nov. 6. The infographic below takes a look at what's up for grabs, the current forecasts, and what history offers us on midterm elections and the stock market.
A number of market headwinds—including trade tensions, rising interest rates and a general fear the long-running US economic expansion may be facing fatigue—have cast a shadow over the markets in the first half of the year.
Equity investors in the emerging markets (EM) have suffered significantly as a result of the escalation of the Turkish crisis. But a closer look at the EM index reveals that not all emerging markets are in crisis mode.
A review of last month’s market-moving events across countries and asset classes.
We look at ways to de-risk, diversify and differentiate ahead of a turn in the economic cycle.
In light of the Turkish lira and Argentine peso currency drops, fears of emerging-market (EM) contagion appear to be on the rise, and various EM currencies have been under pressure. Here, Franklin Templeton Emerging Markets Equity provides perspective on some of the impacted countries in the headlines recently: Argentina, Turkey, South Africa and Indonesia.
The US stock market, as measured by the S&P 500 Index, just reached a historic milestone.
The Tax Cuts and Jobs Act has generated a host of questions about tax and charitable planning in 2018 and beyond. Educating clients and guiding them to the most impactful and tax-smart charitable giving can help deepen your relationships and differentiate your practice.
While the U.S. economy remains on solid footing, exogenous risks threaten asset values, market confidence, and the strength of the U.S. economy.
Since 2008, US growth stocks (particularly in faster-growing sectors such as technology) have tended to perform better than US value stocks, as the chart below shows.