Asset Allocation Update S&P 500’s valuation suggests downside but not disaster While the valuation of the S&P 500 appears high in absolute terms – even after the falls in the index in 2022 so far – it seems far less stretched once the still historically low real yields of US... 28th April 2022 · 5 mins read
Asset Allocation Update Relative asset performance after inflation has peaked Although the fortunes of major assets have varied after high inflation in the US has peaked, we still think the historical evidence may offer clues to their relative performance in the coming years. 27th April 2022 · 5 mins read
Asset Allocation Update Slim chance of another 2000s-style boom in EM equities We think that a period of sustained outperformance from emerging market equities relative to those in developed markets – like that which accompanied the last big bull run in commodities in the 2000s... 22nd April 2022 · 6 mins read
Asset Allocation Update US value stocks may continue to outperform While the long-running underperformance of US value stocks relative to growth stocks seems linked in part to lower interest rates and structural weakness in the economy, much of it is hard to... 14th April 2022 · 5 mins read
Asset Allocation Update Revisiting the case for Japanese equities The valuations of mid- and large-cap equities in Japan have become even more attractive compared to those of their US counterparts following a further period of substantial underperformance in common... 12th April 2022 · 5 mins read
Asset Allocation Update US yield curve and equities dancing to different tunes The resilience of the US stock market over the past month or so is hard to square with recent inversions in parts of the US Treasury yield curve. While we do not think that these inversions... 6th April 2022 · 4 mins read
Asset Allocation Update What Russia’s exclusion means for MSCI’s EM EMEA Index Even though the ejection of Russia from the MSCI EM EMEA Index has changed its country and sector composition, we doubt that this will meaningfully change how it tends to behave. Our forecasts for... 1st April 2022 · 3 mins read
Asset Allocation Update High inflation no guarantee of US REIT outperformance We think that the poor performance of US REITs in 2022 so far – despite rising concerns about inflation – adds to the evidence that REITs are not necessarily a better inflation hedge than ordinary... 25th March 2022 · 3 mins read
Asset Allocation Update A closer look at Treasuries vs. US equities in the 70s & 80s We doubt Treasuries would underperform US equities as emphatically as they have in recent weeks if oil prices and inflation surged a lot more. Indeed, they could conceivably outperform – as they did... 25th March 2022 · 5 mins read
Global Markets Update Revising our market forecasts in light of the war We think the war in Ukraine and a more hawkish Fed will cause the yield of 10-year US Treasuries and the US dollar generally to end 2022 and 2023 a bit higher than we had previously anticipated. We... 18th March 2022 · 4 mins read
Asset Allocation Update Lower valuations may help European equities outperform Their net fall since the invasion of Ukraine means the valuations of European equities are now even lower relative to those of US stocks. While valuations have a mixed track record at predicting... 17th March 2022 · 3 mins read
Asset Allocation Update Oil embargoes and asset returns: lessons from 1973-74 If the Russia-Ukraine war escalated, we would expect some of the recent patterns in relative asset market performance to continue to echo those during the 1973-74 oil crisis. That said, we wouldn’t... 11th March 2022 · 5 mins read
Asset Allocation Update What to make of the recent outperformance of US equities The war in Ukraine has challenged our view that US equities will underperform those in other developed markets over the next few years. We are not yet ready to abandon this view while the outlook is... 8th March 2022 · 5 mins read
Global Markets Update How the war in Ukraine is challenging our views This Update discusses three ways in which the outbreak of war in Ukraine has called into question our asset allocation views. While the situation is fluid and the outlook especially uncertain, it also... 4th March 2022 · 6 mins read
Global Markets Update Lessons from past conflicts and crises The onset of other major conflicts and military-related crises have often seen global equity indices tumble, while moves in developed market government bond yields have depended on how energy prices... 4th March 2022 · 4 mins read
Bonds & Equities War-induced rally in DM bonds may not be sustained While the war in Ukraine may well push down the yields of long-dated developed market government bonds further in the near term, we think that a sustained rally in bonds is unlikely unless the war... 2nd March 2022 · 4 mins read
