CIO Insights: Two-Speed Recovery Puts Premium on Diversification

Scott Wittman

Scott Wittman, CFA, CAIA, Chief Investment Officer, Asset Allocation & Disciplined Equity

Increasing global economic and capital market integration has helped to align developed nations’ economic cycles over the last several decades. However, this global synchronization has unraveled to some degree, with economies around the world in different phases of recovery, stagnation, and even recession.

This global economic decoupling has important implications for investment strategy, requiring savvy country selection, tactical asset allocation and, at a minimum, more effective diversification. Continue reading

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CIO Insights: Accelerating Through Choppy Markets

David Hollond

David Hollond, Chief Investment Officer, U.S. Growth Equity – Mid & Small Cap

The market environment, while choppy, appears to be improving for stock-specific risk, with the Federal Reserve tapering quantitative easing as a catalyst for future improvement. The number of accelerating stocks continues to increase, which means we have a larger pool in which to choose from amidst the uneven market.   Continue reading

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Chart of the Week: Americans Not Saying “I Do” in Record Numbers

Chart of the WeekCensus and other population data (2012) reveals that a record one-in-five adults (42 million) ages 25 and older had never been married, which is up dramatically from only one-in-ten adults that had not walked down the aisle in 1960. Men are more likely to not have made the marriage commitment than women, but this gender gap has grown from only 2% to 6%. Continue reading

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CIO Insights: Don’t Sleep on Rising Rate Dividend Investing

Phillip N. Davidson

Phillip N. Davidson, CFA, Chief Investment Officer U.S. Value Equity

The prospect of higher interest rates in 2015 has investors rightfully thinking ahead. It has been proven in three consecutive circumstances since 1991 that rising rates do not necessarily signify a negative outlook for stocks. We view dividend income as playing an important role in total return over time and represent a key lever in smoothing out returns. We also use convertible securities in several of our portfolios with the goal of reducing the volatility of returns, limiting downside risk, and enhancing yield. Continue reading

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Chart of the Week: How Far Would You Move for a Job?

Chart of the WeekWhile it is a daunting task to pick up and move, 64% of people worldwide said they would take a job in another country. According to a recent survey* conducted by the Boston Consulting Group and The Network, respondents in emerging markets such as Ghana, Jamaica, Honduras and Pakistan were willing to uproot themselves for employment opportunities. More than 75% of respondents in Switzerland, 80% in Australia, and 90% in the Netherlands would consider moving to another country for work. In most countries, young people are more mobile than their older counterparts—59% of Americans ages 21 to 30 are willing to consider opportunities abroad.  Continue reading

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Q4 2014 Fixed Income Macro Outlook

Our Global Macro Strategy Team provides its perspective for the fourth quarter of 2014. Download the complete Q4 Fixed Income Macro Outlook.

Key topics addressed this quarter:

  • U.S. Economy: Moderate growth with headwinds; improving U.S. fundamentals
  • U.S. Inflation: Long-term upward trend but most likely contained in near term
  • U.S. Monetary Policy: Quantitative easing (QE) tapering is almost completed, and discussion of higher rates has begun
  • U.S. Interest Rates: Range-bound with upward bias toward normalization; still heavily managed by central banks
  • Global Economy: Subdued global growth with widespread stimulative policies and muted inflation

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CIO Insights: Diversifying with Global Credit

Dave MacEwen

G. David MacEwen Co-Chief Investment Officer

“Global Divergence,” the result of muted global economic growth conditions compared with more moderate, sustainable growth in the U.S., has helped the unexpected U.S. bond rally this year. That’s reduced some of the appeal of U.S. government debt (it looks relatively expensive) and reinforces the idea of diversifying, selectively, into global credit, both U.S. and non-U.S.

 

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Chart of the Week: Americans Snared in the Web of Student Loan Debt

Chart of the WeekWhile people ages 25 to 49 hold the majority of student loan debt, loans among seniors 65 and older rose more than 500% from 2005 to 2013 ($2.8 billion to $18 billion) according to a recent report from the United States Government Accountability Office. While the majority of senior debt (80%) was taken out to fund their own college education, 20% of the loans were taken out on behalf of a child or dependent. These seniors are digging deep into their Social Security benefits and savings, leaving some retirees with income below the poverty threshold. Continue reading

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Q4 2014 Global Equity Outlook: A Tale of 200 Cities

Mark S. Kopinski

Mark S. Kopinski
Co-Chief Investment Officer, Global and
Non-U.S. Equity

Keith Creveling, CFA

Keith Creveling, CFA
Co-Chief Investment Officer, Global and
Non-U.S. Equity

The big story as we enter the last quarter of 2014 is that there isn’t one story, but many. Conditions in world markets are influencing local economic results directly and creating a collection of diverse local stories rather than one cohesive global economic picture. We continue to believe in the sustainability of the global recovery, despite the disparity in the extent of recovery seen in the various world economies.

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CIO Insights: U.S. Handing QE Baton Off to Europe

Mark S. Kopinski

Mark S. Kopinski
Co-Chief Investment Officer,
Global and Non-U.S. Equity

Keith Creveling, CFA

Keith Creveling, CFA
Co-Chief Investment Officer,
Global and Non-U.S. Equity

The U.S. and the other world markets have diverged along the road to economic recovery. Consequently, their approaches to monetary and fiscal policy are also at varying stages of development.

The U.S. and Europe in particular appear to be at a global crossroads. While improving U.S. fundamentals have lifted stocks to all-time highs, European data has been less encouraging, and stocks have languished. Yet there is reason for optimism as it appears the U.S. is ready to pass the baton of quantitative easing (QE) to the eurozone.

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