US. Managers still looking for opportunities with rising inflation, market fluctuations
Money managers are largely in agreement that inflation, volatility and further market drops are all likely to be in the cards for investors the rest of the year.
But that doesn’t mean there are not investment opportunities to be found. Equity markets could take a further hit, giving investors the opportunity to find some bargains, but bond strategies could be due for a reversal.
Christopher C. Newman, head of Americas division for T. Rowe Price Group, said in an interview that his clients are primarily worried about inflation and rising interest rates, the impact of these dynamics across financial markets, and ultimately assessing whether their existing asset allocation is designed to achieve longer-term objectives.
“We have experienced a meaningful increase in clients engaging us in an advisory-based capacity to help evaluate various sources of diversification,” he said. “For the past 40-plus years, diversification typically meant portfolio ballast during periods of weakening domestic or global growth. However, today the scope of diversification has certainly broadened to include inflation risk.”
Mr. Newman added that he sees value in meaningful engagement with clients on dynamic fixed income and alternatives, where T. Rowe Price has invested significant resources to be able to design and deliver a range of alpha strategies.
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