Our Investment Strategy & Research Group provides insights on the markets once a month (Economic Flash), each quarter (Economic Outlook), and whenever the markets or investments warrant special attention.
Back to What We Think.
While we think US equities are supported by corporate earnings growth and potential pro-business policies under Trump, many foreign markets are less expensive, with similar or higher growth prospects.
This will be a year of transition, with major implications for investors. In our Q1 2017 Economic Outlook, we outline the factors we think will be driving the markets, including the interaction of Trumponomics and global monetary policy, as well as how we are preparing for the year ahead.
While we are maintaining a significant allocation to US equities, we see more opportunity in foreign equity markets due to lower valuations and catalysts for growth, including weak currencies and ongoing monetary stimulus.
We advise caution in making major portfolio moves ahead of Trump policy changes that are far from certain. We do think higher federal spending, interest rates and inflation are likely and expect the Fed to raise rates this Dec. and twice more in 2017.
Market volatility is at highest level since the June “Brexit” vote, as uncertainty about US Presidential Election, US interest rates and Eurozone referendums looms large. With US equity valuations already high, corporate profit growth will be key to performance.
On the cusp of the US Presidential election, economic growth is top of mind. Where will growth come from, now that easy money policies are getting diminishing returns? We explore this and other risks to LNWM portfolios, as well as where we’re seeing opportunity.
Recent concern about European banks, and Deutsche Bank (DB) in particular, is valid. However, we don’t think DB is about to fail. DB’s problems are not related to bad loans but lower profitability and the $14 billion US Dept. of Justice fine, which we think will be negotiated lower. In the meantime, we have no direct exposure to Deutsche Bank, and financials are an underweight in our international holdings.
After a calm summer, we look for a pickup in volatility. Among the catalysts: ongoing economic uncertainty, the US presidential election, high equity valuations, and a possible increase in US interest rates.
US equities perform well, despite already high valuations, deteriorating corporate profits, weakening GDP and slowing manufacturing orders. We are monitoring the recent slowdown in business investment, but still except an improvement in the US economy for the second half of 2016.
“Brexit” pushed interest rates lower worldwide, causing a renewed search for yield. We look for yields to remain low, as we think we’re in a world where too much money is chasing too few attractive investments. In our Q3 2016 Economic Outlook, find out what this means for global markets and LNWM portfolios.
Britain’s vote to exit the European Union (aka Brexit) caught markets by surprise, boosting gold, bonds and other “safe havens.” In the near term, Brexit could affect US dollar strength, global growth estimates and the pace of US interest rate increases.
Within US equities, small-cap stocks continue to seem expensive relative to historical valuation metrics. In foreign equities, the weakness we anticipated in emerging markets continues. Overall, we think developed market equities offer better risk-adjusted opportunities.
More than usual, corporate earnings are likely to be the driver for US equity returns in 2016. After many quarters of S&P 500 earnings declines, an earnings rebound is possible in the second half of 2016, given solid consumer spending, a weaker dollar and stabilizing oil prices.
We’re now back to where we began the year – thankfully. But is this the calm before an even bigger storm? Find out why we don’t think so, and how we’re positioning LNWM portfolios for the challenging return environment we see ahead. It’s all in our Q2 2016 Economic Outlook.
The Federal Reserve’s decision not to raise interest rates this spring helped ignite a major rally, especially in riskier assets — emerging markets, high-yield bonds and small stocks. We ourselves remain cautious for many reasons, including the near-term outlook for corporate profits.
Despite the recent rebound in equities, we look for market volatility to continue as the U.S. slowly tightens its monetary policy and China grapples with the slowest growth in 25 years.
We do not think the U.S. economy will tip into recession in 2016. A healthy job market should continue to support U.S. consumer spending and by extension corporate profits, albeit at a modest pace.
We look for turbulence in the markets to continue, separating the wheat from the chaff in many sectors and asset categories. In such an environment, active investing focused on security selection and arbitrage is likely to add value.
We anticipate more volatility ahead, since all the factors that led us to think 2015 would be a relatively weak year for the markets are still in play: China’s slowdown, oil oversupply, diverging monetary policies and stronger dollar.
A rally in the U.S. dollar, driven by a likely Fed interest rate increase this month, affected asset pricing worldwide. LNWM portfolios are positioned for moderate rate increases and higher market volatility.
China’s slowdown and structural issues are real and ongoing. Find out how this is likely to affect the global markets and how LNWM portfolios are positioned in response. It’s all in our Q4 Economic Outlook.
The first half of 2015 was full of uneasiness: Eurozone frenzy over Greece, slowdown in China, and sluggish growth in the U.S. Find out how LNWM is positioned as the markets continue climbing what has become a steeper wall of worry. It’s all in our Q3 Economic Outlook.
Risk management is often an afterthought. But here at LNWM it is always top-of-mind.
Learn about Laird Norton Wealth Management’s investment strategy planning process and why asset allocation is the most important factor impacting a portfolio over a long-term horizon.
Learn about our due diligence process and why we view our selected investment managers as partners in helping to achieve our clients’ goals.
Managed futures have two unique values to their strategies. First and foremost, they provide value in diversification. Second, their historically strong performance during significant downturns in traditional markets suggests they aid portfolios during market dislocations. Learn more about managed futures and why you should consider investing in this alternative asset class.
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