The Weekly Strategy Report (November 12, 2018) - J.P. Morgan Asset Management

The Weekly Strategy Report (November 12, 2018)

Contributor Multi-Asset Solutions
In brief
  • Our 2019 Long-Term Capital Market Assumptions estimate for real global GDP growth of 2.5% is unchanged from last year; despite a few country-level adjustments, the secular growth outlook is stable and risks are balanced.
  • Expected returns for a U.S. 60/40 portfolio are slightly improved, up from 5.25% to 5.50%. The U.S. stock-bond frontier rotated further in a clockwise direction due to higher expected bond returns.
  • Global equity returns are unchanged, but there is some regional divergence, which may offer opportunities for investors. Bond return forecasts improved this year, notably in the U.S., where policy normalization has created a favorable entry point. Alternatives are a relative bright spot, as fee reduction and improved alpha trends lend support.
  • In our current tactical asset allocation we remain overweight U.S. large cap equities and have tactically leaned gradually more into Treasuries; improved valuations should help them provide more meaningful protection during a negative growth shock.


Source: Bloomberg, Datastream, J.P. Morgan Asset Management Multi-Asset Solutions; data as of September 30, 2018.

Weekly Strategy Report (November 12, 2018)

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