Market Outlook

2018 CAPITAL MARKET OUTLOOK MID-YEAR UPDATE

June 2018

At the end of 2017, we described several themes which we believed would be important topics for investors in 2018 in our Insight title “2018 Capital Market Outlook.” As we near the halfway point of the year, we thought it would be useful to provide an update on those themes. In this paper we will also touch on two new themes which we believe are relevant for the remainder of the year.
 
 

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Tax Reform: A Guide for Investors

January 2018

The Tax Cuts and Jobs Acts is the most comprehensive piece of tax legislation since 1986. While most of the focus from market participants has been on the bill’s impact on the public equity market and individuals, other segments, such as fixed income markets, will be impacted.  The attached Insights outlines the potential impact on corporations and certain asset classes.

 

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2018 Capital Market Outlook

December 2017

Our annual Market Outlook provides a look ahead to 2018 and provides a review of our themes from this past year.  As you will notice, many of our themes this year reference the elevated valuations across most capital markets.

 

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Technological Change and its Impact on Financial Markets

December 2017
We believe technological change is one of the most impactful secular trends that will create new industries and eliminate others, impact productivity, and change our daily lives. Very rapid technological change has the potential to result in extreme investment outcomes (positive or negative) over long time horizons across many different sectors and asset classes. In the attached Insights, we outline the risk that technological change presents to investors and suggest ways to potentially mitigate this risk.
 

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What is MiFID II?

November 2017
In 2007, the Markets in Financial Instruments Directive (“MiFID”) was adopted to harmonize financial regulations and create a single, cross-border securities market in Europe. A revised set of regulations, known as “MiFID II”, will go into effect on January 3, 2018. In this edition of Insights, we outline some key tenets of MiFID II and explore potential considerations for asset managers and clients including: 1) the cost impact of MiFID II to asset managers, 2) the potential for fee savings for clients, and 3) potential unforeseen changes to the market landscape after regulatory adoption.

 

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What’s Your Exposure to China?

November 2017
We believe China has risen to become one of the most significant drivers of returns and risk for virtually all asset classes. While investors might assume their exposure to China is quite low, we argue that a significant portion of an investor’s portfolio is likely to be influenced by Chinese actions. The attached Insights details the direct exposure investors have to China, but more importantly, outlines the indirect exposure investors have to China and the implications for portfolios.

 

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Venezuela: An Unfolding Crisis

September 2017

U.S. investors that allocate to emerging market debt may have exposure to Venezuelan debt.  Emerging market debt managers’ active positioning in Venezuela has had and will continue to have a meaningful impact on managers’ relative performance and tracking error in the near-term.  The attached Insights provides additional context on the developments in Venezuela and the potential impact on emerging market debt strategies.

 

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2017 Capital Market Outlook Mid-Year Update

June 2017
At the end of 2016, we described several themes which we believed would be important topics for investors in 2017 in our Insight titled “2017 Capital Market Outlook.” As we near the halfway point of the year, we thought it would be useful to provide an update on those themes. In this paper we will also touch on one new theme which we believe is relevant for the remainder of the year.

 

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2017 Capital Market Outlook

December 2016
At the end of 2015, we published our first capital market outlook. The second installment of this publication provides a look ahead to 2017 and a review of our themes from this past year. As you will notice, many of our themes are influenced by the recent U.S. election results. The impact of our themes for next year will vary by portfolio, but may impact investors of all types.

 

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U.S. Election Implications

November 2016
Donald Trump’s victory in the U.S. presidential election was a surprise to many market participants, resulting in increased market volatility immediately following the election. There is a level of uncertainty with this result as Trump has put forward fewer policy specifics than most Presidential candidates. In addition, because he has no experience in government, we cannot look to prior votes or proposals to better understand his views. Despite the level of uncertainty, we believe it is important to take a longer-term view. The balance of this paper will review what we believe to be the critical issues which will drive markets over the coming months and years.

 

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