Late last year we authored an article detailing the growing differences between the high yield and leveraged loan markets, particularly the overall quality in the high yield market versus that of leveraged loans. Today, some of those most pronounced differences appear to be abating, which should translate to a more convergent outlook for the two markets as it relates to security, structure, recovery, covenants, and ultimately, performance. With the Fed poised to begin cutting rates in 2024, we felt it was important to address these emerging trends before the start of the new year.
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3Q 2023 Market Insights Video
This video is a recording of a live webinar held on October 26 by Marquette’s research team, featuring in-depth analysis of the third quarter and themes we’ll be monitoring for the remainder of the year.
Our 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 estate, infrastructure, private equity, and private credit, with presentations by our research analysts and directors.
Sign up for research alerts to be invited to future webinars and notified when we publish new videos.
For more information, questions, or feedback, please send us an email.
2023 Investment Symposium
Watch the flash talks from Marquette’s 2023 Investment Symposium livestream on September 15 in the player below — use the upper-right list icon to access a specific presentation.
- What Might De-Dollarization and De-Globalization Mean for Equity Markets?
David Hernandez, CFA and Evan Frazier, CFA, CAIA - Private Markets: Opportunities Across the Capital Structure
Hayley McCollum and Brett Graffy, CAIA - Is it Time to Re-Assess Portfolio Objectives?
Greg Leonberger, FSA, EA, MAAA, FCA - Should Investors “Add” to their Core Bond Allocations?
Greg Leonberger, FSA, EA, MAAA, FCA and Frank Valle, CFA, CAIA - Getting Real: Current Outlook for Real Estate
Griffin Gildea and Brett Graffy, CAIA - The Consultant View: Lessons, Recommendations, and Anecdotes
Nat Kellogg, CFA, Aimee O’Connor, CFP®, and Mike Piotrowski, CAIA
Please feel free to reach out to any of the presenters should you have any questions.
Marquette Views on 2024 U.S. Equities Outlook Featured on FIN News
Published May 14, Catherine Hillier, Research Analyst, was interviewed for “Q1 2024: Small-Cap Equity Hiring Sees Uptick,” by FIN News (subscription required).
Catherine discussed the outlook for U.S. equity performance, particularly in the small-cap space in the article, which posits, “Publicly-traded large-cap companies continue to garner the attention of media and investors, but allocator interest is beginning to look down market to the small-cap sector.”
The article also referenced Catherine’s November 2023 newsletter, U.S. Equities: Surprising Strength Gives Way to Macro Risks, and commentary in Marquette’s 1Q 2024 Market Insights webinar, available to watch as a recording here.
Halftime Adjustments
For anyone who regularly reads these letters, recall the market preview edition opined on the outlook for asset classes in 2023, particularly the likelihood of each delivering positive returns for the upcoming year. Given that we are halfway through the year, we would like to use this letter to make “halftime adjustments” to our outlook; with NFL training camps set to open later this month, we couldn’t resist the urge to borrow a football term. We hope this is a quick beach read as you enjoy your summer vacations and prepare for the second half of the year.
This edition re-assesses the outlook for fixed income, equities, and real estate for the second half of 2023.
The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.
2023 Halftime Market Insights Video
This video is a recording of a live webinar held July 19 by Marquette’s research team, featuring live, in-depth analysis of the second quarter and themes we’ll be monitoring in the second half of the year.
Our 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 estate, infrastructure, private equity, and private credit, with presentations by our research analysts and directors.
Sign up for research alerts to be invited to future webinars and notified when we publish new videos.
For more information, questions, or feedback, please send us an email.
Out of Office: Where Real Estate Markets Stand Today
Commercial real estate is increasingly being dubbed the next shoe to drop as markets assess the fallout from the regional banking turmoil. Amid higher rates and tighter credit conditions, private real estate is now facing the same repricing dynamics that hit the equity and bond markets last year, and while further write downs are expected, the headlines are likely overblown. Fundamental and financing issues are largely concentrated within the office sector — which will likely see a correction over a longer time period but be manageable for most core real estate funds — while other sectors, including industrial and multifamily, are actually set to benefit over the next few years.
This newsletter analyzes the current commercial real estate investment landscape including valuations, fundamentals, debt markets, and private real estate returns.
Read > Out of Office: Where Real Estate Markets Stand Today
The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.
Down to the Wire: An Update on the 2023 U.S. Debt Ceiling Crisis
In February of this year, Marquette published a Perspectives piece entitled Is the Sky Falling? that detailed the history of the United States debt ceiling, as well as the early innings of negotiations surrounding its possible increase or suspension given the fact that the $31.4 trillion limit was reached on January 19. In the months since, the Treasury Department has been forced to resort to “extraordinary measures” in order to prevent the U.S. from defaulting on its obligations, including suspending sales of state and local government series Treasury securities. Those measures, however, will likely be exhausted in the very near future according to the nonpartisan Congressional Budget Office (perhaps as early as June), at which point the federal government will ultimately be unable to pay its obligations fully and, as a result, have to delay making payments for some activities and/or default on its debt obligations. This is commonly referred to as the x-date. It is worth pointing out that a number of large Wall Street firms have brought their forecasts of this date forward in recent days.
This newsletter analyzes potential repercussions of a U.S. default and options for a resolution of the debt limit impasse in Congress.
Read > Down to the Wire: An Update on the 2023 U.S. Debt Ceiling Crisis
The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.
1Q 2023 Market Insights Video
This video is a recording of a live webinar held April 20 by Marquette’s research team, featuring in-depth analysis of the first quarter of 2023 and themes we’ll be monitoring in the coming months.
Our 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 estate, infrastructure, private equity, and private credit, with presentations by our research analysts and directors.
Sign up for research alerts to be invited to future webinars and notified when we publish new videos.
For more information, questions, or feedback, please send us an email.
Here to Stay? Fixed Income Opportunities Persist Despite First Quarter Volatility
Going into 2023, one of the primary headlines was the return of “income” to the fixed income asset class. Largely as a result of Fed policy in 2022, yields increased significantly over the course of the year, thus finally offering meaningful income to bond investors. At long last, fixed income could provide all three of its staples to portfolios: diversification, liquidity, AND income. With the Federal Reserve committed to further hikes during the first half of the year, expectations were that the opportunity set would last well into the year.
However, bank failures and the associated fear of contagion have been known to not only fuel volatility in equity and credit markets but send investors to the safety of Treasuries. This dynamic naturally drives prices higher and yields lower as investors look to insulate their portfolios from large drawdowns. That said, the Silicon Valley Bank shutdown coupled with other nervousness around regional banks and then the eventual absorption of Credit Suisse by UBS has not had a significant impact on the outlook for fixed income as of quarter end. After trading inside of 2% since 2020, the yield on the Bloomberg aggregate index closed the first quarter at 4.40%, slightly lower than the December 31, 2022 figure of 4.68% but well ahead of its near-zero value in the years leading up to 2022.
This newsletter analyzes recent market dynamics and the current environment and outlook for fixed income.
Read > Here to Stay? Fixed Income Opportunities Persist Despite First Quarter Volatility