Portfolio Strategist Jessica Noviskis, CFA was featured on Bloomberg TV’s Surveillance coverage on May 11, 2026.
Jessica discussed investor sentiment regarding the ongoing conflict/ceasefire narrative in the Middle East, Fed policy, how artificial intelligence and tech companies continue to shape the market, and how current risks influence portfolio construction and performance.
Watch the segment on Bloomberg’s website or YouTube channel.
The leadership structure of the Federal Reserve is intentionally designed to promote continuity, independence, and institutional stability across political cycles. Specifically, the seven members of the central bank’s Board of Governors serve staggered 14-year terms, while the Chair is appointed to a renewable four-year term by the president and confirmed by the Senate. In this context, the nomination of Kevin Warsh by the Trump administration earlier this year to lead the Fed marks a potential inflection point for U.S. monetary policy leadership. Warsh brings a combination of public- and private-sector experience, having served as a Federal Reserve governor during the Global Financial Crisis, worked in mergers and acquisitions at Morgan Stanley, and later advised policymakers and investors as a fellow at the Hoover Institution and lecturer at Stanford. Warsh’s nomination, first announced in late January and now nearing final Senate confirmation, comes as Jerome Powell is set to end his term as Chair in the coming days, concluding a tenure defined by extraordinary economic shocks and aggressive policy responses. Recent developments have effectively cleared the path for this transition, with Warsh expected to assume the role shortly after Powell’s term expires, even as Powell has indicated he intends to remain on the Board of Governors through 2028 in a move aimed at preserving institutional continuity. Against this backdrop, Warsh is in position to take the helm of a Federal Reserve that has recently undergone a historic tightening cycle and is now navigating the late stages of the inflation fight, setting the stage for what is likely to be an evolution (rather than a reset) of policy direction.
Diversify. Rebalance. Stay invested. Every one of these letters has concluded with that same advice in some shape or form. It’s not particularly shiny and new, but the best documented path to a successful long-term investment program. The last eight weeks are another data point in support of these practices.
In this edition:
On March 30, 2026, the Department of Labor (DOL) issued its proposed regulation: Fiduciary Duties in Selecting Designated Investment Alternatives. This comes after the executive order released by the Trump Administration last August which asked the DOL to clarify its position on alternative assets as well as provide guidance to plan sponsors on fiduciary processes for incorporating alternative investments into DC plans. Marquette’s first DC Perspectives paper on this topic can be found here.
The key takeaways from this newly proposed regulation for fiduciaries selecting designated investment alternatives (DIAs) in participant-directed defined contribution plans include:
This video is a recording of a live webinar held April 16 by Marquette’s research team analyzing the first quarter across the economy and various asset classes as well as themes we’ll be monitoring in the coming months.
Our quarterly Market Insights series examines the primary asset classes we cover for clients including the U.S. economy, fixed income, U.S. and non-U.S. equities, hedge funds, real assets, and private markets, with commentary by our research analysts and directors.
Featuring:
Greg Leonberger, FSA, EA, MAAA, FCA, Partner, Director of Research
James Torgerson, Senior Research Analyst
Fred Huang, Research Analyst
David Hernandez, CFA, Director of Traditional Manager Search
Evan Frazier, CFA, CAIA, Senior Research Analyst
Dennis Yu, Research Analyst
Hayley McCollum, Senior Research Analyst
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If you have any questions, please send our team an email.
Fixed income is the largest global financial market and often one of the largest allocations within institutional investors’ portfolios. A typical fixed income allocation implements an investment grade anchor with a few “satellite” mandates — most commonly high yield bonds, leveraged loans, and emerging market debt — that carry more credit risk but provide higher levels of yield. Fixed income portfolios are often over-exposed to corporate borrowers through both anchor and satellite allocations. Additionally, these satellite allocations usually increase corporate credit risk while reducing equity diversification that fixed income is supposed to provide. Securitized credit provides higher yields and more compelling diversification benefits.
Securitized credit is a large asset class that has been largely ignored by institutional investors due to under-representation in fixed income indices, perceived complexities, and a stigma from its role in the Great Financial Crisis. While factors responsible for under-allocation to securitized credit have merits, these have caused investors to overlook the benefits of the asset class. Securitized credit provides a spread and yield premium relative to similarly rated corporate credit, diversified risk exposure to various credit and market cycles, and lower correlation to both traditional fixed income and equities. Overall, securitized credit’s attributes can help to further optimize portfolio structures.
Healthcare systems have faced an onslaught of challenges in recent years. They had to navigate the operational and financial headwinds stemming from COVID-19, a severe labor shortage, and 2022’s double-digit drawdowns in both stocks and bonds. Since the end of 2022, global equity markets have returned more than 70% cumulatively, but a combination of portfolio draws and elevated cash expense growth has left median days cash on hand roughly flat. Going forward, balance sheet liquidity is likely to be restrained. While operating margins are improving, the appetite for capital spending remains high and the effects of the One Big Beautiful Bill Act have yet to emerge. At the same time, equities are expensive and credit spreads are tight, limiting the margin for error. Health systems need to carefully weigh the risks of a significant market decline with the need for long-term growth.
Anyone who has gone snowmobiling knows it can be simultaneously exhilarating and terrifying. Throttling across snow and through a forest powered by a 75-horsepower engine with two plastic skis to steer makes it hard to feel like one has complete control; 30 mph in the open air feels more like 100!
Nonetheless, operating a snowmobile is pretty straightforward: The throttle is a right-thumb button, the brake is a left-hand squeeze lever. Beyond those two controls, it’s up to the driver to effectively navigate the trail, with the critical concession that the terrain is out of anyone’s complete control. Which brings me to our 2026 market outlook.
The “throttles” for portfolios are the usual constituents: equities, below investment grade credit, and private markets. The “brakes” are investment grade fixed income, particularly Treasuries which can slow a portfolio’s losses if the market tumbles. The terrain is naturally the actual path that each of these asset classes will follow in 2026. Since 2022 the equity market ride has been mostly exhilarating, save for some of the terrifying moments like the market dip after Liberation Day. But that’s in the rearview mirror, and the focus is what is around the bend. Will the thrill continue, or should we ease up on the throttle?
On Monday, May 18, Sam Frymier will be speaking at the National Conference on Public Employee Retirement Systems’ (NCPERS) 2026 Annual Conference & Exhibition in Las Vegas.
Sam will be joining the Annual Investment Consultant Panel: Strategic Perspectives for Public Pension Funds with several investment professionals, described as follows:
As public pension systems navigate an increasingly complex investment landscape, the role of investment consultants remains critical in shaping long-term strategy and decision-making. This annual panel brings together leading investment consultants to share timely insights on market conditions, emerging risks, and evolving opportunities facing institutional investors.
The discussion will explore key themes influencing portfolio positioning, including asset allocation trends, risk management approaches, and the impact of macroeconomic and geopolitical developments. Panelists will also provide perspectives on how pension systems can adapt to changing market dynamics while maintaining focus on long-term objectives and fiduciary responsibilities.
Attendees will gain valuable insights into how consultants are advising clients in the current environment and practical considerations for aligning investment strategies with evolving market conditions.
Since 1941, NCPERS has been a trusted partner to pension leaders across local, county, and state retirement systems with the mission of connecting and empowering public pension leaders with the skills, strategies, and networks to solve today’s challenges and prepare for tomorrow’s. At the Annual Conference, attendees will explore the most pressing challenges facing public pensions and gain actionable insights to navigate them effectively. For more information, please visit the event webpage.
On Thursday, May 7, Tim Burdick, CFA and Greg Leonberger, FSA, EA, MAAA, FCA will be speaking at an educational session hosted by the Community Foundation of Middle Tennessee: “Marquette Associates Investment Update for Fundholders: Understanding Your Fund in Today’s Changing Markets.”
The two will discuss portfolio performance before taking a detailed look at what today’s market conditions mean for long-term charitable giving, including the cost of missing the market’s best days, why disciplined investors tend to come out ahead over time, and how emotional decision-making during volatile periods can shape long-term results.
For more information, please visit the Community Foundation of Middle Tennessee website.
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