Summertime Blues

We continue to see heightened volatility across most of the stock and bond markets as investors brace for additional Federal Reserve rate hikes to combat inflation. Recent inflation highs are a product of the 100-year event of the pandemic and are expected to ease, but it won’t happen overnight.

Over time, financial markets are orderly and rational, but there are times of irrational selling like what we are seeing today. Fortunately, we have positioned our portfolios for these market conditions with conservative allocations to the most volatile sectors, such as technology. Additionally, our increased exposure to alternative investments has improved our overall performance relative to portfolios containing only stocks and bonds.
Our research indicates that stocks and bonds are now closer to fair value and investor sentiment is at levels associated with good near-term performance. As such, we remain optimistic that capital markets, while likely remaining volatile, will advance from their current levels over the next six to twelve months.
Please let us know if you have any questions about our investment approach or the current market environment.
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