Asset Allocation Update Biden’s tax reforms: further fuel for the rotation trade? If enacted, President Joe Biden’s corporate tax reforms could become a significant drag on US equities and hit the earnings of technology, pharmaceuticals and biotech companies particularly hard... 9th April 2021 · 5 mins read
Precious Metals Update Real yields and gold The recent drop in the price of gold below $1,700/oz. has illustrated its greater sensitivity to US long- than short-dated real yields. Although the price has nudged back up above this level at the... 31st March 2021 · 4 mins read
Asset Allocation Update Taking stock of our asset allocation views In light of a raft of recent forecast changes, this Update presents the latest returns projections of our Asset Allocation service for the next couple of years. We think six points are worth... 26th March 2021 · 4 mins read
Asset Allocation Update We doubt higher bond yields will derail DM equities We are sticking to our view that the US stock market will gain a bit more ground this year and next, despite revising up our end-2021 and end-2022 forecasts for the 10-year Treasury yield. We also... 24th March 2021 · 3 mins read
Asset Allocation Update US stock market unlikely to keep beating its economy While the stock market fared much better than the economy in the US overall during the past ten years, we do not expect that to remain the case. 17th March 2021 · 3 mins read
Asset Allocation Update Weighing up the prospects for further rotation Although we do not expect US bond yields to keep on climbing sharply, we nonetheless think that the recent “rotation” in the US stock market has further to run, given the upbeat prospects for the... 12th March 2021 · 4 mins read
Asset Allocation Update Inflation & equities: how much is too much? Too much inflation can spell trouble for equities if it results in tighter real monetary policy or slower growth. But while we expect inflation to pick up in the US, we do not expect either of those... 10th March 2021 · 3 mins read
Asset Allocation Update More thoughts on US equities, bonds and growth In the US, this week’s slide in equities in the face of a renewed rise in real government bond yields might seem puzzling, given the rosy prospects for the economy. But the argument that the stock... 5th March 2021 · 3 mins read
Asset Allocation Update Are REITs more at risk than equities from rising yields? We doubt that Treasury yields will continue to climb rapidly. However, that would be another reason to expect the returns from US REITs to fall short of those from ordinary US equities over the next... 25th February 2021 · 3 mins read
Asset Allocation Update Real yields, economic growth and the US stock market Although we forecast a further small rise in the 10-year Treasury yield this year, we doubt that this will upend the US stock market. 25th February 2021 · 3 mins read
Commodities Update We expect commodities to underperform US equities Although we expect oil prices to rise a bit further this year, we doubt that we are in the early phase of a new “super cycle” in commodities. In fact, we project that the returns from commodities will... 19th February 2021 · 4 mins read
Asset Allocation Update Toning down our optimism on US REITs While we still expect US Real Estate Investment Trusts (REITs) overall to fare reasonably well over the next couple of years, we no longer anticipate that they will outperform the US stock market. 5th February 2021 · 4 mins read
Asset Allocation Update What corporate bonds tell us about equity valuation The relative valuation of the US stock and corporate bond markets is another piece of evidence against the idea that equities in general are currently in a bubble. Their relative valuation today... 22nd January 2021 · 2 mins read
Asset Allocation Update Even less evidence of equity bubbles outside the US While we doubt that the US stock market’s current valuation will prevent it from making further gains, the fact that valuations are much lower in other parts of the world suggests to us that equities... 15th January 2021 · 5 mins read
Asset Allocation Update Even if there is a bubble, it may not burst any time soon We don’t think that there is a bubble in the US stock market. Yet even if we are wrong, it may inflate further before bursting given the outlook for the economy and monetary policy. 14th January 2021 · 4 mins read
Asset Allocation Update 2021 could be a better year for UK equities We anticipate that UK mid- and large-cap equities will fare much better in 2021 than they have in 2020, provided vaccines prove effective in winning the battle against COVID-19. 23rd December 2020 · 4 mins read