Northern Trust Asset Management’s 2023 Capital Market Forecast
Gaining Perspective
Northern Trust’s Capital Market Assumptions (CMA) report, an annual report of long-term average annualized return expectations for a wide range of asset classes, forecasts below-trend global growth at an annualized rate of 2.4% over the next 10 years, moderating developed-market inflation of 2.4%, and a lower global equity return of 6.3% a year on average. The CMA report’s asset class forecasts are driven by six key themes that Northern Trust investment experts see affecting markets and the economy over the next 10 years: restraints on global economic growth, geopolitical fault lines,...
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Preparing for the Sunset of the TCJA Tax Relief
Gaining Perspective
Change is inevitable. When those changes involve tax law, it is extremely important for clients to meet with their financial professional, tax advisor, and legal advisor to discuss any adjustments that may need to be made to their financial, retirement, or estate plan. One change that is looming is the expiration of provisions that were passed under the Tax Cuts and Jobs Act of 2017 (TCJA). Many of the provisions for individuals, including the higher estate tax exemption and the lower individual income tax brackets, were temporary and will expire (“sunset”) December 31, 2025 without...
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The Outlook for Alternative Investments
Gaining Perspective
Managing volatility is a high priority for advisors. The right investments can stabilize a portfolio and dampen volatility, while keeping goals on track. Increasing bond allocations used to be the standard way to reduce volatility, but with bonds more correlated to equities, their diversification value has decreased. With high inflation, bonds also aren’t providing enough real income for many investors. Demand for private credit has increased because of its low correlation to traditional equities and bonds, and enhanced income potential. As an asset class, private credit has a history of...
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The Future of AI-Powered Investment Management
Gaining Perspective
Artificial Intelligence has been a category-killer among investment themes in the past year. Its impact on the wealth management profession has been profound, from gravity-defying value creation on the stock market to optimizing the day-to-day operations of an advisory practice. Every participant in financial services, in companies large or small, needs to embrace and integrate this powerful technology into its future, or risk falling behind. My guest today, Valery Talma, will share his perspective on the state of the art in AI investment management and how advisors can serve their clients...
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The Exceptional Opportunity in REITs
Gaining Perspective
The rise in global interest rates is driving a “great reset” of real estate values. With the ongoing correction in private markets, REITs offer an attractive entry point with valuations at historic lows. In addition, a number of factors favor REITs: Large differences in valuation between public and private RE markets, while rare, have historically benefited REITs. REITS have historically outperformed the S&P post-Fed tightening cycles. REIT sectors are more concentrated in areas with strong sector secular growth, including senior housing, industrials, data centers, and...
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ABLE Accounts for the Disability Community
Gaining Perspective
One of the hardest parts of planning for our loved ones with disabilities is getting started. It’s overwhelming. Thinking of who will care for your child when you or your partner cannot is not easy. While we realize no one will care for your child like you do, you need to plan for the day when you no longer can. In this session, we talk about one tool that may help with some of the financial responsibilities for supporting your loved one while helping them stay qualified for means-tested benefits supplemental security income (SSI) and Medicaid. My guest will introduce the importance of...
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The Compelling Opportunity in Small-Cap Stocks
Gaining Perspective
Several factors point to why this is an exceptional time to invest in small-cap stocks. Small-cap stocks tend to outperform after inflation peaks and in the aftermath of recessions. Small-cap valuations are at 20-plus-year lows relative to large-cap equities. Earnings revisions for small caps are stabilizing and beginning to outpace those of large caps. The M&A market is recovering, which historically correlates with improved small cap performance. - Here is a link for more information about Eric and Penn Capital: Penn Capital web site- Connect with Eric Green on LInkedIn- Penn Capital...
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The Future of Private Equity for the RIA Profession
Gaining Perspective
Private equity has backed many of the recent acquisitions in the RIA profession. Indeed, approximately 77% of in the first quarter of this year involved private-equity funding. Many of the largest acquirers are backed by PE firms, including Mariner, Carson, Mercer, Focus, Savant, Pathstone and the Wealth Exchange Group. When evaluating a PE-backed acquirer, there are a few things to consider, including possible drawbacks and how it will impact the future of your firm. - Here is a link for more information about Advisor Growth Strategies: Advisor Growth Strategies website - John Furey bio - ...
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The Strategy Behind Last Year’s Top-Performing Small-Cap Fund
Gaining Perspective
The SouthernSun Small Cap fund (symbol: SSSIX) is up 13.5% this year, versus 10.33% (as of July 18, 2023) for its Morningstar small-blend peer group. Last year was even more impressive, when it was down only -1.37%, versus its peer group, which was down -16.24%, putting SSSIX in the first percentile of that peer group. It has approximately $400 million in assets and is a highly concentrated portfolio, with only 21 holdings as of March 31, 2023. - Here is a link for more information about SouthernSun: SouthernSun web site- SSSIX fact sheet and performance- Important Disclosures AUM...
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The Future of Advice is Fee-Based
Gaining Perspective
Great things rarely occur within your comfort zone. Earning revenue via commission-based mutual funds or annuities might seem straightforward and familiar, but it isn’t a sustainable way to grow your practice. There’s been a steady trend in the advisory profession to fee-based practices and holistic wealth-management services. But just because this trend is widespread doesn’t mean that transitioning to fee-based models comes without challenges. My guest today, Jen Gloss, will discuss the why and how of transitioning from commissionable products to fee-based wealth management. - If...
info_outlineAt of the start of this year, Rick Pitcairn took on a new position as the chief global strategist at Pitcairn, a 100-year-old multi-family office with $7bn in client assets. In this position, he is focusing on macro-economic trends and is searching for new global initiatives that will add to the firm’s growth.
Rick recently journeyed to India where he met with some of the wealthiest local families to discuss multi-generational wealth transfer. He saw that people all around the world want the same things, including economic security and a safe environment to raise their children. But the investing and business environments differ significantly. Rick knows that U.S. investors have a home bias, but he saw substantial economic growth is happening outside our borders. Rick is here to discuss if an international allocation is appropriate or too risky.
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Here are some links for more information Rick and Pitcairn:
- Rick Pitcairn’s bio
- Pitcairn’s company website
A message from Advisor Perspectives and Vetta Fi: To learn more on this and other topics, check out our full schedule of upcoming CE-approved virtual events.”