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Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.

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Experts Forecast Stock and Bond Returns

"Yet, even as investor balances are depressed, their portfolio prospects are likely better than they were a year ago, a fact that my latest roundup of capital markets assumptions illustrates vividly. Thanks to higher fixed-income yields and lower equity valuations, almost all of the firms in our survey have increased their expectations for stock and bond returns for the next decade. Every firm in our survey expects non-U.S. stocks to outperform U.S. stocks in the decade ahead."
Link

Personally, I usually don't make portfolio changes based on "expert" forecasts.
Having said that, it's interesting to read these firms' assumptions.

Comments

  • Same here. It would be fun to revisit these forecasts a year from now.
  • edited January 2023
    'almost all of the firms in our survey have increased their expectations for stock and bond returns for the next decade'
    I have to discover which shop they're using for Magic 8 Ball repairs and tune-up. Mine will only forecast a day or two ahead !!!

    @Observant1 , thank you for the 'link to a view'.
  • "Mine will only forecast a day or two ahead !!!"

    Yeah, mine too... but the forecasts only have about a 50/50 chance of being right.
  • edited January 2023
    The year of 2022 is a good example. Who would forecast such a difficult year with few safe haven. We can only hope the worst of rate hike is largely behind us as signs of slowing inflation takes hold. Now earning season is upon us. Will they hold up?

    Will stay patient while building up quality bonds with attractive yields, 4% as T bills mature. I would be happy to get a bit ahead of the inflation rate this year.
  • edited January 2023
    Hey - You’re getting what you pay for. Right?

    And who would have forecast the S&P / NASDAQ would be up 4.7% and 8.6% respectively 3 weeks into the new year? (Probably not the International Monetary Fund)
  • Look at the bounce (and volatility) from October 2022 low.

    image
  • edited January 2023
    Not a big proponent of tech analysis. However, several sources I follow have in the last week or so referenced this “breadth thrust” (bullish) indicator. If nothing else, word of it may have induced some investors to take more risk and might be reflected in those early 2023 numbers. That said, I suspect it would be very easy right now to get caught “flat-footed” / leaning the wrong way and get burned by a sharp market retrenchment. - ”You pays your money, and you takes your chances”

    ”For only the 25th time since World War II (an average of once every 3 1/2 years), the Dow Jones Industrials registered what technician Walter Deemer calls “breakaway momentum” (or “breadth thrust”). This often signals a new bull market (or a new intermediate upleg within a bull market).”

    Barry Ritholtz

    image
  • My OEF junk funds were up very slightly today, but my ETF was down a bit. TUHYX PRCPX. HYDB. Go figure.

    I agree with @Junkster: TUHYX is less than wonderful. But I'm married to TRP in the IRA and am limiting the amount I remove from the IRA each year. I play my cards right and I'm a no-tax due person on the 1040.
  • If you want an example of how well "experts" do with predictions look at the 2022 results from the Barron's roundtable experts from January 2022 to the end of the year.

    Almost all of them lost money, big money.
  • Yeah, but it probably wasn't their money, so that doesn't count.
  • edited January 2023
    But I'm married to TRP in the IRA
    @Crash, I'm curious and you don't need to answer, but what makes you married to TRP in an IRA? If your IRA is with TRP, they offer a selection mutual funds from other places too, don't they?
  • “Wonder Boy” didn’t exactly set the house on fire.

    GE - 17.1%
    BDX + 4.0%
    TMO - 9.1%
    KDP - 2.9%
    TEL - 26.2%
    AMZN - 48.3%

    (1 year returns including dividends)
  • @hank, who is wonder boy?
  • edited January 2023
    @MikeM - Giroux

    Photo of current Barrons ”Brain Trust” at work making 2023 predictions (Barron’s Cover / January 23, 2023). The numbers I earlier cited for Giroux’s 2022 picks appeared in the January 16 issue. Abby Joseph Cohen and David Giroux (to her right) visible on right edge of photo. Appears to be Henry Ellenbogen with back to camera. His picks were even worse than Giroux’s.

    image
  • MikeM said:

    But I'm married to TRP in the IRA
    @Crash, I'm curious and you don't need to answer, but what makes you married to TRP in an IRA? If your IRA is with TRP, they offer a selection mutual funds from other places too, don't they?
    I have both T-IRA and a brokerage with TRP. And there's a wall between them, of course. My understanding is that in the IRA, only TRP funds are available. I tried to move some money into one of their ETFs and it did not want to let me do even THAT...

    In the brokerage there are a million prospects, but to invest in a non-TRP fund, you have to plunk down $5k all at once. (Sucks big piles of feces.)
  • Perhaps you could transfer your TRP assets to Fidelity which would give you more investment choices and lower minimums as well-for example non-Fidelity funds have $2,500 minimum and Fidelity funds have $0 minimum .
  • edited January 2023
    Per Troweprice website:

    Choose an account type
    --- Open a taxable Brokerage account OR
    --- Traditional, Roth or Rollover Brokerage IRA in minutes.

    Don't know if this is the same as Fidelity, where an IRA may have brokerage within the account and the money may be invested into just about anything.
    Sometime in the 80's one had to apply to have the brokerage feature attached to the IRA account. Also, in the 80's, IRA accounts with brokerage features were notified that the feature would be blended into the account automatically. I believe today, opening an IRA at Fido; that the brokerage feature is just part of the package (Traditional or Roth). No (0$) minimums.
  • I opened my Fidelity account in 1993 and the brokerage was part of the account then.
  • MANY years ago, Fido converted most mutual fund a/c to brokerage a/c. But some still exist. Of course, most Fido 401k/403b a/c are mutual fund a/c but some may have brokerage windows.
  • +1. I recall trying Fido years ago. There was a reason I did not stay with them.
  • Don't look now but ARKK is up nearly 20% YTD. A lot of that might be due to TSLA but I hold neither.
  • Mark said:

    Don't look now but ARKK is up nearly 20% YTD. A lot of that might be due to TSLA but I hold neither.

    You don’t really “hold” those kinds of investments. More like “riding” them.

    image
  • @Mark

    I was struck by the Barron's article on TSLA 1/8/23

    https://www.barrons.com/articles/buy-tesla-stock-price-pick-51673047775

    "It helps that Tesla is expected to generate the most free cash flow among auto makers in 2023, some $12.2 billion, up from $9 billion in 2022. Toyota, the second-most-valuable auto company, is expected to generate free cash flow of about $10 billion this year and next. "

    So I held my nose and bought a little. It is up from $121 to $177

  • I bought 1 share of Tesla @113.06 on 1/4/2023 for entertainment value. Needless to say, I should have bought more!
  • Expert forecast? Nope, just the facts, ma'am:
    Good start to 2023.
    TUHYX. I'm still down by quite a bit, but the published YTD numbers are encouraging: +5.48%

    Glad I bought PRCPX, too. I'm not in possession of all of it, but the YTD number = +4.11%.
    Bought into PRFDX (equity income) at the right time, too. YTD +5.02%.

    ETF. HYDB. YTD +3.48%.
    ETF SCHP. YTD +2.76%.
    (It's still January. Who needs EQUITIES, eh?)
    Source: Morningstar.
  • edited January 2023
    d
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