Government Policy and Wealth Taxes
Recent proposals by President Biden aim to implement a minimum 25% tax rate on ultra-high-net-worth households. The narrative extends globally with various states and countries moving towards higher capital gains taxes to fund social initiatives, reflecting a worldwide trend towards more aggressive
Shorter-term View
Combining key issues with potential future scenarios, we forecast market movements influenced by inflation trajectories and economic growth patterns. Detailed scenarios range from optimistic projections of robust GDP growth and moderate inflation to pessimistic forecasts involving reaccelerated inf
Equity Markets
The S&P 500 surged by 10.4% in Q1, though it faced a 5.4% decline in early April due to inflation concerns and interest rate hikes. We scrutinize equity valuations with the S&P 500’s market-cap weighted P/E ratio at 19.8x, indicating slight overvaluation compared to historical norms.
Fixed Income Markets
The quarter was challenging for fixed-income assets, with significant declines in US Treasuries and corporate bonds. The analysis discusses the yield environment and bond market responses to economic indicators, noting current yields present attractive opportunities in safer fixed-income investment
Actionable Investment Opportunities
For certain clients we recommend increasing allocations to mid-term US government debt and engaging more in secondary private equity transactions. In private investments, we highlight the potential of senior direct lending and asset-backed credit solutions, particularly for middle-market borrowers,
Alternatives & Private Investments
Private equity reported a 6.2% rise YTD, reflecting solid performance despite broader market challenges. The discussion covers hedge funds, real estate, and private credit markets, highlighting evolving investment valuations and strategic entry points in the current economic climate.
Special Topic: Asset-Based Lending
Asset-based lending (ABL) is a crucial segment of the lending market, involving senior loans secured by tangible or financial assets, such as equipment, inventory, and accounts receivables, across various industries. Serving a broad range of borrowers, including corporations, individuals, and lendin
Actionable Investment Opportunities
In the current investment landscape, we spotlight the appeal of short-term US and Canadian government debt, advocating for maturities of two years or less with yields between 4.0%-5.0%, and suggesting an eye on 10-year US Treasuries should yields rise, offering potential for price appreciation. The
Alternatives & Private Investments
In 2023, the alternatives and private investments sector exhibited a diverse performance landscape. The HFRX Hedge Fund Index recorded modest gains, buoyed by strong results in convertible arbitrage and equity-hedge strategies. US private real estate showed mixed signals, with flattening apartment r
Fixed Income Markets
In the fixed income markets, both safe and riskier categories witnessed significant appreciation during Q4 2023 and into 2024, buoyed by a sharp decline in interest rates. Government bonds and corporate investment grade bonds saw their values increase as US Treasury yields dropped by approximately 7
