A bit of strategic opining from Goldman Here on the recent market moves. In short, they think the markets overreacted to the recent Fed talk and that it’s created a buying opportunity in stocks (via Zero Hedge):
- Clients should use the recent downdraft to build toward their strategic allocation to equities.
- While we think that interest rates will gradually rise over the next several years and lead to low investment Grade Fixed Income returns, a repeat of 1994 is highly unlikely.
- We recommend tactically underweighting Investment Grade Fixed Income in favor of the followingareas where the risk-return opportunities are much more attractive:– High Yield Bonds– US Bank loans– Emerging Market Local Debt– Euro Stoxx 50 (currency hedged)– US Bank Equities
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.