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The commodities market appears to be recovering, but will it continue to improve throughout 2020? Find out which economic factors will drive—or sink—the asset class.
Direct indexing has been called the ETF killer, ETF 2.0, and a catalyst that will bring an end to commingled investment vehicles. But to make proper use of all its benefits, the script must be flipped on the narrative of direct indexing to show not only the importance of customization but also that its value comes from understanding how and when to use it. There’s enormous potential for direct indexing to become a lot bigger than it is today. Find out whether it’s right for your portfolio.
Climate change occurs slowly over time, which may make it an easy risk factor for investors to ignore. Recent studies suggest that climate change will have a negative economic impact on long-term global GDP. Over the shorter term, investor concerns about global warming may be priced into their assessment of stocks and bonds. As with any long-term secular trend, climate change will likely result in both winners and losers.
Much of the trade conflict between the U.S. and China can be traced to China’s desire to be a technological power. It is difficult for China to do much more than play catch-up in established technology like semiconductors, where improvements are incremental. Still, emerging technologies such as AI, robotics, quantum computing, and next-gen IT infrastructure present greater opportunities for industry leadership. China is unlikely to cede its ambitions, suggesting there will be an altered landscape moving forward regardless of the trade war outcome.
As part of the investment review process, there is the identification of key areas of focus or themes that will drive investment returns over the immediate term. This quarterly update highlights market and economic considerations relevant in the context of enhancing risk-adjusted outcomes, beginning with evolving global growth dynamics.
Although climate risk is likely underestimated by financial markets, investors would be wise to consider it in their investment decision-making process. Given the expected future repricing of this risk, there is a window of opportunity for investors to get ahead of the curve. This paper provides a high-level overview of the current climate science and discusses a few economic implications.
The pursuit of forecasting what opportunities and obstacles lie ahead takes added importance when looking at a new year and new decade to come. What follows are some thoughts about the opportunities and challenges before us, along with the identification of significant trends that will guide our analysis and portfolio recommendations. In addition, this issue includes an explanation of a goals-based investing approach, updated performance for major asset categories, and key market events to watch.
The familiar cliché that hindsight is 20/20 seems particularly apt as we step into the year 2020 and look back on the decade of the 2010s. Throughout the past 10 years, we returned time and time again to principles and themes that we considered vital for success not just in this decade, but any decade. Revisiting the core principles and themes, while also highlighting the market’s lessons, will serve wealthy families well in the decade to come.
In 2020, we see a slightly better economic growth environment but modest capital market returns relative to the stellar gains of 2019. The global economy and markets will take two steps forward as stimulus measures lead to firming global growth, but policy uncertainty will cause markets to periodically take a step back. The U.S. election will come into focus, and markets will ebb and flow with the changing dynamics of the race. Equities should outperform fixed income. The push and pull interest rate environments is set to continue.