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☆ Jeremy Grantham's right-hand man Ben Inker warns your 60/40 portfolio is in for a 'lost decade' of negative returns
▼ + stars: | 2024-09-30 | by ( Christine Ji | ) www.businessinsider.com time to read: +5 min

The popular 60/40 portfolio of stocks and bonds has returned double digits annually since 1979. Inker shares the risks of the 60/40 strategy and where he's looking for opportunities. AdvertisementFor decades, the 60/40 strategy has been the gold standard of investing. As a result, the 60/40 portfolio right now is not set up to generate attractive returns. Related storiesInvesting against the grainInstead of the traditional 60/40 portfolio, Inker recommends taking a more flexible approach to different asset allocations.

Persons: Ben, —, Jeremy Grantham, doesn't, they've Organizations: Service, Bloomberg

☆ A notorious market bear who called the 2000 and 2008 crashes shares 3 charts revealing striking similarities between today's market and the most extreme bubbles — and warns of 50-70% downside for the
▼ + stars: | 2024-06-29 | by ( William Edwards | ) www.businessinsider.com time to read: +6 min

"In contrast, current valuation extremes imply potential downside risk for the S&P 500 on the order of 50-70% over the completion of this cycle." JPMorgan's Marko Kolanovic expects the S&P 500 to fall to 4,200, while more extreme forecasts include Jeremy Grantham's estimate in the low 3,000s. And as the stock market ground mostly higher, he persisted with his doomsday calls. He predicted in April 2007 that the S&P 500 could lose 40%, then it lost 55% in the subsequent collapse from 2007 to 2009. The S&P 500, by comparison, is up about 26% over the past year.

Persons: —, Jonathan Golub, Count John Hussman, Hussman, Hussman's, Morgan Stanley's Mike Wilson, Piper Sandler's Michael Kantrowitz, JPMorgan's Marko Kolanovic, Jeremy Grantham's Organizations: Service, UBS, Business, Hussman Investment Trust, New York Stock Exchange, Investor Intelligence

☆ Jeremy Grantham's GMO just launched an actively managed fund focused on high-quality stocks. Its manager shares 7 unique companies he's betting on to deliver high returns.
▼ + stars: | 2023-11-24 | by ( William Edwards | ) www.businessinsider.com time to read: +4 min

The GMO US Quality ETF (QLTY) launched on November 12, and as its name implies, the fund seeks to offer investors exposure to so-called quality stocks through an actively managed approach. This story is available exclusively to Business Insider subscribers. "At GMO, internally we also talk about intrinsic value, which is adjusting for growth and quality," Hancock said. The aerospace business manufactures and re-services airplane engines, and the continued resurgence in global demand for travel following the pandemic bodes well for the business, Hancock said. While the timing of the ETF release is not related to Grantham's call, Hancock said quality stocks are typically more defensive in a recessionary environment.

Persons: Tom Hancock, Hancock, Jeremy Grantham, Grantham Organizations: Business, Microsoft, Apple, Nvidia, Electric, GE

☆ Jeremy Grantham's GMO launched its first ETF with top portfolio managers. Here's what's in it
▼ + stars: | 2023-11-18 | by ( Jesse Pound | In Jesse-Pound | ) www.cnbc.com time to read: +2 min

Jeremy Grantham's investment firm is taking its first steps to enter the world of exchange traded funds, debuting a new offering modeled on one of Grantham, Mayo, Van Otterloo's crown jewel mutual funds. The GMO U.S. Quality ETF (QLTY) launched last Wednesday, marking the investment firm's first ETF. The new ETF will be managed by the same team that helms GMO Quality III mutual fund ( GQETX ). The QLTY ETF should see a similar turnover rate of around 20% to what the mutual fund has, he added. Jeremy Grantham, GMO's chief investment strategist, is not directly involved in the new ETF.

Persons: Jeremy, Van, Tom Hancock, Hancock, Jeremy Grantham Organizations: Quality, helms, Morningstar, Microsoft, General Electric Locations: Grantham, Mayo

☆ Wall Street is betting on an active management comeback with new ETF launches
▼ + stars: | 2023-09-28 | by ( Jesse Pound | In Jesse-Pound | ) www.cnbc.com time to read: +5 min

There were 68 active fund launches in the third quarter as of Sept. 22, compared to 49 indexed fund launches, according to CFRA. Passive funds still make up the majority of the ETF market, and they typically cost less than active products. JEPI, the biggest active ETF, has underperformed the S & P 500 this year but is still attracting new cash. "One of the problems with straightforward active funds, and we do run some straightforward active funds, is that very often ... you are tethered to that broad index, whatever happens to be in that. Abbott's firm launched five new active funds last week, including the Matthews Japan Active ETF (JPAN) .

Persons: Rachel Aguirre, Euan Munro, BNY Mellon, Cooper Abbott, Stephanie Pierce, Dreyfus, Jeremy Grantham's, Abbott Organizations: BlackRock, CNBC, JPMorgan —, Nasdaq, Newton Asset Management, BNY, Matthews Asia, Matthews Japan Active, SEC, Mellon & Exchange, BNY Mellon Investment Management Locations: BALI, BlackRock

☆ Jeremy Grantham's GMO says now is the time to jump into bank stocks as failures ravage the sector. Here are 2 banks it says are trading at valuations 90% cheaper than historical norms.
▼ + stars: | 2023-03-30 | by ( William Edwards | ) www.businessinsider.com time to read: +3 min

Big bank stocks have rarely been cheaper, says GMO's asset allocation team. Two GMO is most bullish on are JPMorgan and Bank of America. Financials-sector stocks have gotten hammered in March amid the failures of institutions like Silicon Valley Bank and Signature Bank, and as UBS hastily acquired a troubled Credit Suisse. The eight GSIBs include: JPMorgan, Bank of America, Citi, Goldman Sachs, BNY Mellon, Morgan Stanley, State Street, and Wells Fargo. While GMO said it couldn't comment on which seven banks it likes, it said they include JPMorgan (JPM) and Bank of America (BAC).

☆ Stocks are getting a boost from a key indicator that's been a reliable sign of more gains to come
▼ + stars: | 2023-02-03 | by ( Phil Rosen | ) www.businessinsider.com time to read: +5 min

In case you missed it, the European Central Bank Thursday made a half-point interest rate hike, marking its fifth consecutive move as part of its inflation-fighting efforts. Speaking of rates, today we're going over a key economic indicator that suggests more upside ahead for stocks. Ever since the Fed started tightening policy last March, the stock market has been highly susceptible to interest-rate volatility. Specifically, the MOVE Index — which measures volatility of US Treasury yields — has dipped to lows that haven't been seen since the Fed's first rate hike of this cycle. This means potentially smaller swings in the stock market as highly rate-sensitive equities get some relief after big rate moves battered indexes in 2022.

☆ Jeremy Grantham's right-hand man Ben Inker shares 5 trades to start making now for the best returns and smallest downside risk in the cheapest parts of the market
▼ + stars: | 2023-02-02 | by ( William Edwards | ) www.businessinsider.com time to read: +3 min

They include:Global Value vs. GrowthEmerging Value EquitiesJapanese Small ValueEuropean Small ValueResource StocksGlobal value and emerging market value stocks carry the most weight in the strategy among these five factors at 20% and 16%, respectively. In fact, he and his firm think some broader equity indices like the S&P 500 may still have big downside. the S&P 500) will deliver negative returns over the next seven-year period. "When markets did decisively turn in 2003 and the S&P 500 gained a gratifying 28.7%, Emerging rose a stunning 55.8%. Perfect timing would have seen investors hold their fire in emerging markets in 2001-02 to hit the very bottom.

☆ Here's how the Fed's rate hike can move markets and whether to expect a central bank pivot
▼ + stars: | 2022-11-02 | by ( Phil Rosen | ) www.businessinsider.com time to read: +6 min

That bank thinks the Fed is going to skirt any talk of a pivot, and opt for continued rate hikes albeit at a slower pace. Goldman Sachs listed three reasons the Fed will carry on with rate hikes:US inflation will remain "sticky" so a pivot won't be justified. Keeping rate hikes going until March 2023 will set up the central bank for a future pivot. US stock futures rise early Wednesday, as eyes turn toward the Fed's rate hike decision later today. Here's what you want to know about the 1920 rule that's still moving markets more than a century later.

☆ Jeremy Grantham's firm says it's time to buy into small cap stocks. Here are the themes and companies GMO is most bullish on.
▼ + stars: | 2022-11-01 | by ( Marley Jay | ) www.businessinsider.com time to read: +3 min

Jeremy Grantham's firm GMO just launched a fund targeting "quality" small-cap stocks. Growing fears about a recession weren't enough to stop small cap stocks from having a great month in October. But small caps seem to have some momentum behind them despite rising interest rates and signs of a slowing economy. They say that quality small caps have outperformed small caps in general by 1.8% a year since 1976, and they've beaten a mix of small-, medium-, and large-caps by 2.8% a year in that time. That's a challenge for any investor, but they say it's harder with smaller companies because their competitive edges fade faster.

☆ Jerome Powell's favorite bond-market gauge is on the verge of inverting, a sign of impending recession. That could mean a Fed pivot within months.
▼ + stars: | 2022-11-01 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +3 min

If that happens, it would signal an impending recession and a Fed pivot by the spring of 2024. The Fed chair touted the predictive power of the short end of the yield curve earlier this year. An inverted yield curve is one where interest rates for short-term fixed-income securities are higher than those for longer-term ones. "That's really what has 100% of the explanatory power of the yield curve. The Fed is expected to announce yet another mega-hike of 75 basis points at the end of its October meeting Thursday, which could invert Powell's favorite yield curve.

☆ Wharton professor Jeremy Siegel expects stocks to soar 30% in 2 years - and house prices to tumble 15% from their peak
▼ + stars: | 2022-11-01 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +3 min

Jeremy Siegel expects US stocks to surge by 20% to 30% over the next two years. The Wharton professor sees interest rates dragging house prices down by 10% to 15% from their peak. Siegel warned the Fed risks causing a recession if it continues to aggressively hike rates. "I'm flabbergasted," Siegel said about the Fed scrambling to cool inflation based on lagging indicators such as rent increases. "What the market is so scared about is there seems to be no limit to their talk: 'Hike, hike, hike, hike, hike," he said.

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