Home Logon FTA Investment Managers Blog Subscribe About Us Contact Us

Search by Ticker, Keyword or CUSIP       
Blog Home

  Alternatives Update 4th Quarter 2022
Posted Under: Alternatives

As 2022 ended, many capital market participants gladly said adieu. It was a year of horrid returns for traditional portfolios, a stellar year for alternative strategies, and possibly the year that forced regulatory agencies to get more serious about their oversight of the digital investment arena after a string of historic thefts, alleged frauds, and bankruptcies.  Inflation remained quite high at 7.1% (CPI YoY) but continued its downward trajectory in the 4th quarter. Risk assets rallied on the hopes that the Federal Reserve (the “Fed”) was nearing the end of its tightening cycle.  Mortgage rates moved below 7% but are still at levels not seen in over a decade.  Concluding that peak inflation is in the rearview mirror presumes many things: well behaved energy markets, resolute Central Banks, less international strife, reasonable environmental regulations, and disciplined government spending. None of these can be taken for granted or even considered probable, in our opinion.  

Investor focus seems to have shifted from inflation as a juggernaut to how soon the Fed’s pivot on interest rates will come and flash the “all clear” to go all in on risk.  The Fed has repeatedly said high rates are here to stay for quite some time and they will not be cutting in 2023.  In our view, the long end of the U.S. Treasury market and the outsized positive moves of equities in response to softening economic data convey that the markets don’t believe the narrative and think sooner than later, the Fed will fall back on their old ways of priming the economy with easy money.  Inflation still exceeds growth in the U.S. by a wide margin, only a robust job market prevents classifying the current economic environment as solidly stagflationary.    

To view the entire article, click here.

Posted on Monday, January 23, 2023 @ 2:12 PM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
Search Posts
Dave McGarel
CIO, COO | Bio
  1. Market Minute
Bill Housey
Senior Portfolio Manager | Bio
  1. Income Insights
Ryan Issakainen
ETF Strategist | Bio
  1. ETF Data Watch
  2. ETF Observations
  3. Inside First Trust ETFs
  4. First Trust ROI Podcast
Jeff Margolin
Closed-End Fund Analyst | Bio
  1. Closed-End Fund Quarterly Commentary
Client Resource Kits
  1. Alternatives
  2. Equity
  3. Fixed-Income
  4. Markets In Perspective
  5. Investment Themes
Other Newsletters
  1. Alternatives Update
  2. Housing Tracker
  3. Commercial Real Estate Tracker
  4. Equity Newsletter
  5. Weekly Market Commentary
  6. Weekly Market Watch
Subscribe To Receive Email

Closed-End Fund Fourth Quarter 2022 Review
ETF Data Watch - Asset Flows Monitor January 2023 Edition
Market Minute December 2022
ETF Data Watch - Asset Flows Monitor December 2022 Edition
Asset Flows Monitor November 2022 Edition
Market Minute November 2022
Hopeful Signs Emerging for the Biotechnology Industry
Income ETFs: Beyond Traditional Dividend Strategies
Closed-End Fund Second Quarter 2022 Review
Alternatives Update 3rd Quarter 2022
Skip Navigation Links.
Search by Topic
Skip Navigation Links.

The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Follow First Trust:  
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2024 All rights reserved.