The return of volatility in the first quarter left many investors wondering whether the years -
long equity rally is starting to show cracks (FIGURE 1).
Not exact matches
That data raised a fresh round of questions about how the Federal Reserve will proceed on further cutting back on its massive monthly bond purchases, which have kept
long - term rates low and encouraged a strong
rally on
equity markets.
1) BusinessWeek, 1979: «This «death of
equity» can no
longer be seen as something a stock market
rally — however strong — will check.
Hunt also cautioned against investors being too optimistic in the
long run about
equity indexes» continued
rally since Donald Trump was elected U.S. President.
Although the Euro's dip today is helping
equities in Europe somewhat, the pronounced
long - term weakness in Asian and European markets still persists, and the deterioration among the leaders of the
rally, like the Nasdaq, is another sign that the correction will continue.
By Claire Milhench (Reuters)- Investors raised their
equity holdings in April from March's five - year lows, taking the view that the global stock market
rally will continue as
long as central banks maintain their loose monetary policies, a Reuters poll showed on Friday.
The size of the package, the open - ended nature of the commitment and the willingness to purchase
longer dated bonds all came as positive surprises to investors, driving this past week's strong
equity rally.
This means it no
longer consistently
rallies in
equity market selloffs — notwithstanding the recent risk - off period.
Right now we are somewhere between 1 / 6th and 1/3 hedged, which means we're still «rooting» for markets to go up: if markets
rally we will be underwater on the hedges but will still be net -
long equities even apart from the fixed - income safety net.
Cleary,
equity based alternative strategies, such as
long / short
equity, struggled to keep up with the strong
rally in March, however, nontraditional bond funds performed well relative to their
long - only counterpart (Intermediate Term Bonds).
Emerging market
equity funds stood out on the
equity side with a category return of 3.64 % while the
long government bond category
rallied and closed the month up 5.83 %.
After Quality stocks continued to
rally through January, our forecasts for the group fell, leading us to sell down our remaining
long Quality
equity position (though we retain exposure to a beta - neutral expression of Quality, per below).