Headed into the final quarter of the calendar year, we turn our attention to the upcoming holiday season, specifically to the sustainability of U.S. consumer spending in this important period for the economy.  Will we finish the year with the gift of sustained positive year-end market returns or finish with a bag of coal like we experienced last year?  We believe that sustained U.S. consumer spending trends will provide part of the answer to this question.  Although we are still positive on sustained U.S. spending growth, we acknowledge increased risks. 

Much of the uptick in volatility experienced in early 2018 continued into the end of the year and remains a factor in early 2019.  Our Portfolio Manager Julio Quinteros addresses the increase in volatility as the market shifts away from a synchronized global growth view to one that is now navigating a variety of global risk factors.

Despite a more tenuous global backdrop, the prospects for the U.S. economy remain positive and supports the case for higher interest rates. A higher interest rate backdrop will likely result in further market volatility as stock valuation expectations adjust to interest rate moves. This month, Julio Quinteros discusses a rising interest rate environment as a significant variable that limits market returns, and could spill into other areas of the U.S. economy.

Despite a noisy backdrop, at the midway point in 2018, U.S. equity indices are leading their global counterparts. This month Allen Trust Company’s Portfolio Manager, Julio C. Quinteros, Jr. discusses the recent divergence in performance between U.S. and international markets, with a focus on year-to-date weakness in emerging equity markets.

Through the first half of March it is now clear that increased volatility in financial markets is a constant to take into account and balance as part of our investment considerations. While we acknowledge that risk factors are higher, volatility on its own does not give us pause. We remain focused on long-term investment opportunities. This month, Julio Quinteros discusses the rise in volatility and resulting ebb and flow of markets. Despite higher volatility, we remain grounded in our investment approach.

Bitcoin and cryptocurrencies have entrenched themselves as front and center topics that are reaching an ever broader audience as new highs in cryptocurrency values are breached. Although crypto assets receive headline attention, we see the underlying blockchain technology as the more important driver for long-term investments in tech.

 This month, Julio Quinteros discusses the rapid ascent of crypto assets and blockchain. His focus is on the long-term impact that blockchain could have on Tech investments.