Five Multi-Asset Strategies for 2020’s Challenges
The last decade produced great performance across most asset classes. But in the 2020s, we expect investment market returns will be lower and risk harder to manage. Looking forward, a disciplined multi-asset approach will be especially valuable to identify opportunities and help mitigate setbacks.
The Need for Private Credit
Private credit relies less on broad market trends and more on the strength of each specific investment. For individuals facing retirement, institutions looking to satisfy long-term pension liabilities or even private investors looking for alternative investments, it offers high current income, low correlations with public markets and lower default risks than yield spreads would imply.
Q4 2019: "New Highs"
It has been a great year for equity investors. The S&P 500 index posted a 31% annual return, the Dow 25%, and the NASDAQ a spectacular 39%. More than $6T of equity paper wealth was created for domestic investors this year alone.
FHFA House Price Index: Up 0.2% in October
The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for November. U.S. house prices were up 0.2 percent on a seasonally adjusted nominal basis from the previous month. Year-over-year the index is up 4.9% (nonseasonally adjusted). After adjusting for inflation and seasonality, the index is down 0.04% in November and up 3.44% year-over-year (seasonally adjusted).
Existing-Home Sales Down Up 3.6% in December
This morning's release of the December Existing-Home Sales fell to a seasonally adjusted annual rate of 5.54 million units from the previous month's 5.435 million. The Investing.com consensus was for 5.43 million. The latest number represents a 3.6% increase from the previous month and a 10.8% increase year-over-year.
2020 Sector Outlook: Mortgage and Structured Finance
Looking ahead, we believe the global economic environment will remain supportive for securitized sectors despite potentially slowing economic growth. In the US, we believe strong fundamentals, including robust wage growth and healthy household balance sheets, will provide solid support for real estate and consumer-related credit.
Forecasts or Nowcasts? What’s on the Horizon for the 2020s
Now is the season for forecasting as one decade turns into the next. Pundits and market prognosticators too often treat nowcasts as true market forecasts, which can be very dangerous for investors’ financial health. Our forecasts for the decade ahead rely on empirically driven quantitative models.
Secular Trends in Residential Building Permits and Housing Starts
Over the long haul the two series offer a compelling study of trends in residential real estate. Here is an overlay of the two series since the 1959 inception of the Starts data and the Permits data, which began being tracked a year later.
New Residential Housing Jump in December
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for December new residential housing starts. The latest reading of 1.608M was above the Investing.com forecast of 1.375M and an increase from the previous month's revised 1.375M.
New Residential Building Permits: 1.416M in December
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for December new residential building permits. The latest reading of 1.416M was a decrease from 1.474M in November and below the Investing.com forecast of 1.468M.
NAHB Housing Market Index: "Builder Confidence Begins Year Strong as Single-Family Growth Continues"
The National Association of Home Builders (NAHB) Housing Market Index (HMI) is a gauge of builder opinion on the relative level of current and future single-family home sales. It is a diffusion index, which means that a reading above 50 indicates a favorable outlook on home sales; below 50 indicates a negative outlook. The latest reading of 75 is down 1 from last month.