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Opportunities on the horizon: Investing through a slowing economy.
As we describe in this 2023 Mid-Year Outlook, the economic policy “hangover” from the COVID-19 shock, government intervention and subsequent rate hikes still reverberate across the world economy.
5 mins
The market rebound in 2023 has reminded investors of the futility of market timing. While the worst looks to be behind us, the bear market journey is not yet complete. Investors can potentially benefit from income-generating assets while beginning to reengage portfolios in a number of building valuation opportunities and long-term growth generators.
In our view, the landscape for investing suggests some major shifts in portfolios. We believe that active asset allocation may add value in the period just ahead.
Now, we see the USD as having peaked. This turning point creates a series of potential opportunities that are reflected in our updated Strategic Return Estimates (SRE)1 for non-US assets.
5 mins
Where to find potential fixed income opportunities now
Bonds are back and there are numerous potential opportunities to diversify bond portfolios, add to duration, and possibly earn higher total returns. This is a time for portfolio action in the fixed income space.
The expected growth in AI suggests significant investment opportunities for companies that facilitate its infrastructure, such as hardware manufacturers and cloud computing vendors.
The players leading the charge include major traditional energy companies and energy producing nations that see the green transition as inevitable and profitable. Capital scarcity favors leading firms with strong capital positions.
15 mins
The past few quarters have been marked by uncertainty, volatility and public market paralysis which has stretched investor confidence as portfolios got whipsawed through the news headlines and Federal Reserve tightening cycle.
2 mins
The choices investors make over the next six to nine months may have profound implications for their portfolio returns over the years to come.
A decade ago, we predicted that the US dollar would achieve far greater value and that the US would attract more investment. That’s exactly what happened. Now, we see the US dollar as having peaked.
There are new opportunities to diversify bond portfolios, add to duration, diversify risk and earn potentially higher yields.
A highly concentrated US tech rally this year masks the value still present in global equities following the 2022 bear market. Economic and profits growth should bottom in the next few quarters, likely presenting an opportunity to diversify portfolios into non-US shares, profitable small firms, and still-depressed growth stocks.
Investors should not disengage from long-term growth opportunities and evolving risks because of immediate market conditions. Explore these trends in more detail below.
Discover our Mid-Year Wealth Outlook 2023 insights and themes.
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