There’s only one sure way to identify an asset bubble, and that’s after the bubble has burst. Until then, a fast-appreciating asset may seem overvalued, only for its price to keep rising. Anyone who has tried to breathe one last breath into a balloon and finds it can accommodate …
While the global economy continues to recover as we head into 2021, the battle between the virus and humanity’s efforts to stanch it continues. Our outlook for the global economy hinges critically on health outcomes. The recovery’s path is likely
A look at the personal investing behavior of Vanguard’s 5 million retail households Vanguard investors have a long-term risk outlook The typical Vanguard household holds a long-term, risk-taking portfolio that's both diversified and balanced. The average portfolio consists of 63%
"Patience in investing is the capacity to endure periods of underperformance in hopes of achieving an investment objective. For many investors, outperforming the broad market through traditional active management or factor-based investing is a key goal— and one that requires
The COVID-19 pandemic has unleashed economic effects unlike any the world has seen before. Among the most disruptive events of our lifetimes, it defies conventional labels. A comparison of the current economic environment with past recessions speaks to the severity
Market perspectives Asset-class return outlooks Recent market performance has moderately raised portfolio expected returns. Our preliminary 10-year annualized nominal return projections, as of March 31, 2020 …
Megatrend: The Idea Multiplier: An Acceleration in innovation is coming The persistent downturn in productivity growth during the past two decades has cast doubts on global economic prospects. Frequently cited causes include slow adoption of technology, an aging population, and
Global economy: Trade tensions and broader uncertainty drag on demand and supply The continued slowdown in global growth foreseen a year ago has been accentuated during 2019 by a deterioration in the global industrial cycle. A broad escalation of policy
About the Megatrends series Megatrends have accompanied humankind throughout history. From the Neolithic Revolution to the Information Age, innovation has been the catalyst for profound socioeconomic, cultural, and political transformation. The term “Megatrends” was popularized by author John Naisbitt, who
Private equity (PE) continues to be an alluring asset class for nonprofits attracted to its promise of higher returns and low correlations to traditional assets. While it can potentially have a place in the portfolio, PE imposes a very long
How should we measure the value of financial advisory services to investors? In this paper, we introduce a new three-part framework based on portfolio, financial, and emotional outcomes. We illustrate several aspects of our approach using data from Vanguard Personal
High-yield bonds, which represent the debt financing of companies rated below investment grade by the primary rating agencies (Ba1 or lower for Moody’s Investors Service, BB+ or lower for Standard & Poor’s), carry greater issuer risk than traditional fixed income
Risk is a thorny word. In its simplest form, it means exposure to danger, but in an organizational or business context, it takes on a much more complex definition.
How should we measure the value of financial advisory services to investors? In this paper, we introduce a new three-part framework based on portfolio, financial, and emotional outcomes. We illustrate several aspects of our approach using data from Vanguard Personal
Global macro matters In the 12 months following July 2014, the U.S. dollar (USD) soared 20% amid falling oil prices and further monetary easing in Japan and Europe. As USD appreciation tightened global financial conditions, world industrial production growth declined
Megatrends have accompanied humankind throughout history. From the Neolithic Revolution to the Information Age, innovation has been the catalyst for profound socioeconomic, cultural, and political transformation. The term “Megatrends” was popularized by author John Naisbitt, who was interested in the
Stock markets around the world were caught in a downdraft in December, and once again algorithmic trading— automated buying and selling based on predetermined triggers—took some of the blame. Speculation that machines are running, and perhaps ruining, the markets is
Regardless of where they live, investors have a significant opportunity to diversify their equity portfolios by investing outside their home market. Despite this opportunity, investors on average have maintained allocations to their home country that have been significantly larger than
