The 3rd quarter of 2019 saw continued market volatility primarily focused on
The ongoing trade saga between the U.S. and China (if you like roller coasters try following that closely!)
Recession indicators shifting back and forth from negative to positive with lots of press about a “looming recession”
A Federal Reserve that is divided about whether rate increases or rate decreases are the proper move right now, combined with presidential tweet input on the subject at a level not seen before.
Impeachment talks, Saudi oil attacks, Brexit and a more realistic Eurozone recession, Hong Kong protests, and more…
And yet, through all of that the investment markets (stock, bonds, and real estate) have all had a pretty strong year. You probably wouldn’t realize it if you were just looking at the headlines. These topics will all continue to be the main things that we will be keeping an eye on for portfolios in this 4th quarter as well.
While we always have weekly updated content linked here on our website, I know the majority of you at most prefer these quarterly update summaries. A few of those resources are below:
1) J.P. Morgan’s Guide To the Markets - One of my favorite resources for charts & commentary related to what is happening in the markets and the economy, Dr. David Kelly and their team do an excellent job of trying to pull together a wide range of data. Click here for an 11 minute video of him giving a great current summary & reviewing what he believes to be the most relevant slides currently. To follow along and read the commentary, click here.
2) Vanguard Market Perspectives - click here for an easy to read summary of Vanguard’s perspectives on the major areas of focus for the markets. Also of note is their 10 year forward looking return projections for various asset classes based on current market environment that show well-below long-term averages with global stocks leading the way that line up with other research I have seen as well. My take on this is that an active commitment to making smart personal financial choices combined with global diversification is more important than ever.
3) Lazard Quarterly Summary & Outlook - click here for their US focused review and Outlook. Contact me for their Europe, Japan or Emerging Markets versions.
The bottom line is to expect continuing volatility from the many headlines in our world today. Selective and diversified exposure to stocks in the appropriate amounts based on your risk tolerance still seem to be the most attractive place to allocate capital for long-term investing. We have recently enhanced our risk assessment tools that we use for portfolios. If you feel you may need to update your information in that area to review your portfolio, please let me know. All the best!