Right here is our 2023 funding outlook. I did this somewhat in another way this yr by offering a state of affairs evaluation with completely different chance distributions. I believe this can be a a lot better manner of analyzing potential outcomes and can assist you to higher perceive the vary of outcomes.
My overarching view is that the vary of outcomes nonetheless stays very broad as a result of we’re digesting the COVID growth which is evolving right into a bust. Which means portfolio focus is more likely to be a excessive danger endeavor and that broad diversification stays smart as we navigate this unusual interval. The Self-discipline Index was bearish in 2022 and nonetheless stays bearish. It’s laborious to see that altering except shares fall considerably and/or the financial system stabilizes considerably. Then again, markets are beginning to digest the modifications. Equities, regardless of nonetheless being unusually dangerous, look far more engaging than they did a yr in the past. In the meantime, traders need to bail on bonds, however they appear extra engaging to me than they’ve in a really very long time. Having the ability to purchase a Treasury Invoice at 4.75% is a present for my part. Even junk bonds at 8% are beginning to look first rate. Nevertheless it’s nonetheless going to be a yr of persistence in my opinion and one that can take a look at your self-discipline at occasions.
I want you all a really blissful new yr. I hope you take pleasure in this outlook and discover it helpful as all of us attempt to navigate the approaching yr.