Q4 2022 Asset Class Update
A ‘Santa Claus rally’ sent risk assets rallying into the new year, as markets doubted central bankers’ resolve to keep raising rates. Will 2023 bring falling inflation and a soft landing, or disappointment for investors?
The Real China Headline Risk
Some investors avoid China due to headline risk. But that itself may be the biggest risk of headlines: avoiding China. In this article I explain why.
Q3 2022 Asset Class Update
In our latest Quarterly Asset Class Update, we break down global markets by the numbers, offering thoughts as to where markets could be headed as 2022 heads into the home stretch.
When Smart Beta Meets Machine Learning and Portfolio Optimization
Smart beta products using common factors like value, low volatility, quality, and small cap experienced an underwhelming performance from 2005–2022. On average, long-only factor portfolios built from a wider set of global factors identified in the finance literature generated significantly positive excess returns across countries, suggesting diversifying across many factors is more prudent than selecting a handful that have performed the best.
You Are Already a China Investor
Many investors say they “don’t invest in China” at all – despite having tens or even hundreds of millions invested in an emerging markets portfolio. These investors would be well-advised to understand the extent to which their EM portfolio is, in fact, invested in China.
7 Predictions for a Stagflation Economy
Jason is making some predictions…and fully acknowledging that all of them could be wrong. There are only two sustainable options in investing: lose money fast, or compound returns slowly. Diversification remains the only free lunch in investing, and it has always been (and is likely to remain) the best way to successfully weather turbulent markets.
The People vs. Inflation: A Political Problem (Not an Economic One)
What will happen if our politicians pursue an economic “hard landing” that weakens employment for below-median households? What if Fed rate hikes crater consumption by further reducing their real income and wealth? If these things happen, we will achieve a Friedman-esque victory against inflation … but an ultimately empty victory for Main Street. At its heart, our current inflation is a political problem. It is going to require a political solution.
Untangling Fear and Risk: An Investment Survival Skill
The so-called “fear premium”—the alpha opportunity created by fear-driven markets—is well-studied and understood. And yet, few investors have the discipline to avoid the behavioral mistakes caused by fear. Those who do will not only survive, but thrive.
Q4 2021 Asset Class Update
Red-hot inflation going into 2022 has pulled forward the Fed’s timetable for tightening, just as a surge in Omicron cases threatens to hit growth. How will markets react to rate hikes in the year ahead?
Q3 2021 Asset Class Update
Shipping bottlenecks and strained supply chains contributed to a spike in prices during Q3. Will hawkish central bankers end the party for stock and bond investors, or might such fears turn out to be ‘transitory’, as well?