Should Investors Go Long Duration Following This Year’s Sell-off in US Treasuries?

No, we do not recommend that investors go long duration in fixed income portfolios. The uncertain inflation outlook and potential for more aggressive policy tightening suggest yields could rise further. That said, we believe investors that are short duration in their fixed income portfolios should increase duration to match their benchmark, given the improved risk/reward […]

April 2022

Are High Oil Prices a Threat to Investors?

Yes, but the level of threat varies across asset classes. Higher oil prices are likely to slow economic growth and weigh on corporate profits across many regions, but more so in countries that are large energy importers, where the energy intensity of growth is highest and where governments have the fewest resources to cushion the […]

April 2022

Higher Rates Are a Headwind, but US Housing Rests on Solid Foundations

The US housing market has been on a tear in recent years, supported by low interest rates, favorable supply/demand dynamics, and a recent boost from the pandemic-related demand for more space. Investors interested in gaining exposure to the asset class are seeing their choices expand. This publication provides an update on some of the macro […]

April 2022

Would Adoption of Policies Like the Rooney Rule by Asset Allocators Encourage Greater Diversity Among Investment Managers?

No. Adoption of policies like the Rooney Rule—a requirement to interview at least one woman or person of color candidate for leadership positions by many companies and institutions—has not substantially improved diversity among leadership ranks. Given this reality, we doubt such policies would encourage greater diversity among investment managers. These policies are not created to […]

March 2022

Is the Decline in Chinese Equities Justified by Market Fundamentals?

We don’t think so, as the markets are pricing in more severe conditions than we believe are warranted. The MSCI China Index, which tracks Chinese stocks listed in both Hong Kong and the United States, has sold off sharply thus far in March and is down roughly 25% year-to-date, and over 50% from its February […]

March 2022

What Long-Term Investment Implications Should Investors Be Monitoring Related to the War in Ukraine?

As we peer through the fog of war, prospects for a decline in US dollar dominance, durably higher inflation, and persistent heightened geopolitical risk appear on the horizon. However, it can take a long time before ripples either fade out or become waves. And their future path is influenced by their interaction with each other […]

March 2022

How Should Investors Alter Portfolios Considering the War in Ukraine?

Thoughtfully, if at all. Russia’s invasion of Ukraine sent shockwaves across the world, creating a tragic humanitarian and geopolitical crisis, and introducing new uncertainty to the global economy and financial markets. The lynchpin to understanding how assets may perform in the coming days and weeks is, of course, knowing the duration of the war and […]

March 2022

Do Significant Geopolitical Events Tend to Precede Equity Bear Markets?

No. Global equities tend to sell off following major geopolitical events, but such declines have historically been mild and short-lived, far below the 20% drawdown threshold that is typically considered a bear market. We view this historical tendency as a useful, but imperfect, benchmark in thinking about the impact of the current Russia-Ukraine crisis on […]

February 2022