Now that the U.S. economy is firmly in a self-sustaining mode, it may be harder for investors to profit from equities in 2015. What’s the answer? Liz Ann Sonders of Charles Schwab thinks it’s time to seek a more balanced portfolio and offers some recommendations. One thing to consider is alternative investments, which don’t act like traditional ones. They have produced higher returns than stocks, bonds or cash, with less than half the volatility of stocks. Christine Johnson of AllianceBernstein explains how to get started. The European markets should be more attractive to investors now that the European Central Bank has begun a Quantitative Easing program. Russ Koesterich believes these “credit corners” of the bond market offer the promise of higher income.
Self-Sustaining US Economy…So What Now?- The US economy appears to be firmly in self-sustaining expansion mode. While welcome, that could make near-term gains in the stock market harder to come by as the expectation bar has been raised. Liz Ann Sonders, chief investment officer at Schwab, believes that investors who have let their portfolios tilt heavily toward US equities should create a more balanced portfolio by adding some international equity exposure. Read more…
Alternate Current: The Power Of Diverse Return Sources– Investors may be surprised to learn that over the last 25 years, alternatives have produced higher returns than stocks, bonds or cash—with less than half the volatility of stocks. Alternative investments have that name for a reason: they don’t act like traditional investments. Adding alternatives thoughtfully to a portfolio may lower its sensitivity to the stock market and interest-rate fluctuations. Alternatives also have the potential to enhance long-term returns and reduce risk. Christine Johnson of AllianceBernstein explains why. Read more…
The Cascade Effect Of Europe’s QE– After months of hinting and speculation, the European Central Bank (ECB) finally embarked on a new quantitative easing (QE) program that is massive in both size and scope. QE by itself probably won’t solve Europe’s chronic economic malaise, though it should mitigate the risk of deflation and support European exporters through a weaker euro. The reach of the €1 trillion-plus program, however, extends beyond the continent. Russ Koesterich, Chief Investment Strategist at Blackrock, discusses the effects on stocks and bonds. Read more…
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John R. Day, Bill Ennis, Stephanie Davidson and Matt Heller