Wealth Management

Investor optimism has been boosted in the U.S. and China due to recent policy developments—the Federal Reserve's decision to cut interest rates by half a percentage point and an easing of monetary policy and a larger-than-expected fiscal stimulus package in China. Meanwhile, the upcoming presidential election has not had a major impact on financial markets to date. Amid this, we explore portfolio positioning.

The debate among investors at the beginning of 2024 focused on how long the economy could sustain above trend growth and whether inflation would continue to decelerate. As we look ahead, most economists have lowered the likelihood of a recession this year considerably amid continued strong economic data, but risks to the bullish outlook remain.

One of the most important issues for investors and policymakers alike is understanding the potential impact that generative artificial intelligence (Gen AI) models will have on the economy and labor market.

Financial markets often surprise investors, but the past year defied virtually all forecasts. The prevailing view at the start of the year was that aggressive tightening by the Fed would produce a recession. Instead, economic growth far surpassed expectations at 2.6% according to Fed estimates.

Investors have come to accept that the Fed will keep rates “higher for longer.” Meanwhile, prospects for a soft landing have improved as core inflation has come down significantly this year. Still, investors must assess whether the U.S. economy can stay resilient now that interest rates are positive in real terms and economies abroad are weakening.

The first half of 2023 was full of surprises. Bond yields surged initially and then subsequently fell back in early April when several regional banks encountered problems. By midyear, however, yields had risen again as the economy proved resilient to Fed rate hikes. Meanwhile, the S&P 500 Index, which had fluctuated in a broad trading range since mid-2022, broke decidedly to the upside in the second quarter, reaching its highest level since April 2022.

After fluctuating in a broad trading range since the middle of last year, the S&P 500 Index broke decisively to the upside in June, reaching its highest level since April 2022.

A pause gives policymakers time to assess whether core inflation, which is running at about 5 percent, will also subside.

Many investors are uncertain about what to do with spare cash. Fortunately, for the first time in more than a decade, they can earn a reasonable return on their cash holdings now in money market funds.

One of the biggest anomalies so far this year is how calm the U.S. stock market has been while gyrations in bond yields have been unusually large.

A question often asked is, how long can the dollar retain its status as the world’s principal currency? There have been numerous occasions when commentators declared an end to the dollar’s dominance—only to be proven wrong.

The bond market experienced one of the most volatile quarters in history in the first quarter of 2023. There also remains uncertainty about how widespread issues are in the banking sector and how these could impact the economy as a whole. We believe that if a recession does transpire, it will be mild, as household and business balance sheets are strong.

Are investors still striking the right balance with the popular 60/40 portfolio?

On December 29, 2022, the Consolidated Appropriations Act of 2023, a spending bill authorizing $1.7 trillion in Federal spending, was signed into law. Included in that bill was the retirement bill SECURE Act 2.0.

2022 was one of the worst years for U.S. stocks and bonds, as inflation spiked to a four-decade high. Looking ahead, the key issue for investors is whether Fed tightening will spawn a U.S. recession. Fort Washington’s Senior Economic Advisor Nick Sargen shares a 2023 outlook for the economy and how we are positioning investment portfolios.   

Charitable giving can help reduce your taxable income and by understanding donor-advised funds vs. private foundations, you can determine which may work for you.

For individual investors, it's important to understand the risks involved with investing, and how risk tolerance can influence your overall financial strategy.

Higher education will likely come with a high (and increasingly higher) price tag, so it makes sense to plan well in advance.