As we head toward the a new year, exchange traded fund investors should reflect on what has happened through a tumultuous year and plan for potential risks and opportunities ahead.
On the upcoming webcast, The Big Picture: Year-End Review and 2016 Outlook, Ron Saba, senior managing director of investment and CIO for Horizon Investments, John Eckstein, chief investment officer at Astor Investment Management, Jim Ferrin, chief investment officer at Quantitative Advantage, and Theresa Brennan, ETF regional vice president at Deutsche Asset & Wealth Management, will reflect on another wild year and outline where the global economy is heading.
Developed market stocks have so far been outperforming as record low interest rates and trillions of dollars worth of quantitative easing by global central banks fueled a multi-year rally.
However, global growth concerns are rising and investors have grown more cautious ahead of the widely-anticipated U.S. Federal Reserve hike this week.
Consequently, Morgan Stanley strategists expect that while the global economy will continue to expand, global growth outlook may slow ahead, Reuters reports.
“Lower growth means subdued corporate earnings; and continued U.S. dollar strength will likely prove a headwind for equities and emerging market assets,” Morgan Stanley strategists said in a note.
Moreover, crude oil prices, which recently fell back toward financial crisis lows, along with the broad weakness in the commodities market, have also dragged on global markets.
According to a poll of over 300 equity analysts and fund managers, participants showed that the 19 stock indices surveyed are expected to rise between now and the end of the year but at a slower pace than expected three months prior.
“We think the (bull market) is going to continue but we’re later into the cycle, so the returns we’re expecting are lower than what we got earlier in the cycle,” Jill Carey Hall, equity and quantitative strategist at Bank of America Merrill Lynch, told Reuters.
The S&P 500 is expected to rise about 6% by June next year and end 2016 at 2,207, or 10% above Friday’s close and 5% above where it was expected to round off this year.
Year-to-date, the SPDR S&P 500 ETF (NYSEArca: SPY), iShares Core S&P 500 ETF (NYSEArca: IVV) and Vanguard 500 Index (NYSEArca: VOO) dipped about 0.3%.
Looking at the global equities market, the iShares MSCI ACWI ETF (NasdaqGS: ACWI), which tries to reflect the performance of the MSCI ACWI Index, dropped 4.2% so far this year while the Vanguard Total World Stock ETF (NYSEArca: VT), which follows the FTSE Global All Cap Index, fell 3.9%.
Financial advisors who are interested in learning more about major investment themes for 2016 can register for the Tuesday, December 15 webcast here.