April 22, 2020—Highlights:We have reduced our exposure to real estate investment trusts (REITs) from an overweight to a neutral allocation.Risk assets like REITs and equities have staged a strong rally since March 23, but we expect a slow economic recovery, the risks around which do not appear to be properly appreciated by investors.We took the opportunity to sell REITs into relative strength to reduce overall risk in client portfolios.
April 21, 2020—Financial markets remain in turmoil, but the focus has shifted from the equity market to the oil market. This week, oil prices fell into negative territory, a phenomenon that would seem to make about as much intuitive sense as negative interest rates. Here we discuss what is happening and offer some perspective on the path forward for energy prices.What happened?On Monday, April 20, the May contract for West Texas Intermediate crude, the U.S.
March 26, 2020—The stock market’s precipitous drop has wreaked havoc on portfolios, wiping three years of gains from the U.S. stock market in a matter of days. What we have experienced puts us in uncharted waters: a combination of one of the fastest declines in equity market history, the most abrupt and wholesale halting of economic activity ever, and the most rapid deployment of monetary stimulus we’ve ever seen.