CIO Investment Outlook
By
👤Pimco
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Asset Allocation Outlook
CIO Investment Outlook
As the economic expansion aged and volatility increased throughout 2018, consensus shifted from viewing the U.S. expansion as likely to continue for the foreseeable future to believing that we are in the late stages. However, the sharp sell-off at the end of the year, in which U.S. equity markets (S&P 500) declined by 19% from September peak to December trough, has forced investors to consider whether this is the end of the expansion, or simply a sharp late-cycle correction that has created tactical buying opportunities. Our view is that the economy remains late cycle, not end cycle. Yet this calls for a significantly different approach to investing than the one that has prevailed over the last 10 years, which generally was to lever up and maximize long positions in each asset class as cheap starting valuations combined with central bank support and continued globalization and efficiency gains boosted asset prices
By
👤Pimco
