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  • May
    14
    2013

    Emerging-Markets Equity: It’s About the Middle Class, Small Caps and Long-Term Growth

    Emerging markets have dramatically evolved over the past 20 years, quadrupling as a percentage of the MSCI ACWI-ex U.S. Index. On a global basis, the middle class is expected to expand rapidly through 2030. We believe the bulk of that growth will be concentrated in emerging-markets countries in Asia and the Pacific Basin. An expanding middle class should increase domestic consumption in emerging economies and this will likely provide a disproportionate benefit to small-cap stocks. Emerging-markets equities are trading at a 20% discount to historic average valuations.

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  • May
    13
    2013

    April 2013 Monthly Commentary

    Japan hit the headlines by announcing dramatic quantitative-easing initiatives. Global equity and fixed-income markets both experienced gains, although equities maintained their edge. The appetite for risk continued within fixed income, favoring emerging-market debt and high-yield bonds.

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  • Apr
    22
    2013

    Gold—Burst Bubble, or Pause that Refreshes?

    Less than two years removed from the most recent leg up of its long bull run, gold suffered a vicious two-day sell off.  Debate is now raging over whether gold was a bubble due to burst, or presents a long-term buying opportunity. We remain agnostic on precious metals, but believe there are interesting lessons to draw from the episode.

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  • Apr
    12
    2013

    First Quarter 2013 Market Commentary

    After an optimistic January, the mood in February and March was more downcast. Global equity markets held up well amidst the bad news and outperformed the fixed-income market. Risk appetite was apparent in the global fixed-income markets and high-yield bonds set the pace.

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  • Apr
    4
    2013

    Economic Outlook: Investors Keep Calm and Carry On

    Although Europe is a mess and emerging markets have struggled, many stock markets have been rising. Can the strong performance continue? While past performance is no guarantee of future results, there are some signs that the answer is “yes.”

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  • Mar
    14
    2013

    Understanding Bond Performance When Interest Rates Rise

    SEI research demonstrates that even under a substantial increase in interest rates, bonds can contribute positively to portfolio returns and may help reduce the negative effects caused by economic downturns.

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  • Mar
    13
    2013

    February 2013 Monthly Commentary

    After an optimistic January, the mood in February was more downcast. Major central banks remained accommodative in an effort to help stimulate growth. Global financial markets declined marginally. Risk appetite in fixed-income markets continued to expand, while demand for risk within equities was more muted.

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  • Feb
    27
    2013

    U.S. Government Budget Sequester--Is the Sky About to Fall?

    Some $85 billion worth of federal spending cuts are expected to take effect on March 1. While this looks like a large number, it amounts to only 2.4% of the federal budget and 0.5% of the U.S. economy. SEI sees no reason to adjust our investment strategies based on the potential impact of sequestration.

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  • Feb
    26
    2013

    An Update on Canada’s Southern Neighbour

    Stock markets started 2013 with a bang, which could bode well for full-year returns. We are cautious at the moment, as investor sentiment appears to be somewhat stretched. However, we believe that the underlying economic fundamentals validate the optimism reflected in stock prices.

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  • Feb
    15
    2013

    Don’t Discount the Dividends

    Most investors are aware that bonds are typically a stable source of income with less risk of capital, while stocks are an excellent option for portfolio growth. What some investors fail to realize, however, is that stocks can also be a source of current income—in the form of dividends.

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  • Feb
    13
    2013

    January 2013 Monthly Commentary

    2012 ended on a positive note and this sentiment extended into and throughout January.  Major central banks remained accommodative in an effort to help stimulate growth. Global equities experienced respectable gains for the month as investor sentiment remained buoyed, while global bonds declined marginally. Risk appetite in the financial markets was high.

    [... More]

  • Jan
    16
    2013

    Fourth Quarter Market Commentary

    Investor focus switched from the U.S. elections to the looming “fiscal cliff” and ongoing worries surrounding the fate of the eurozone. Major central banks once again remained accommodative in an effort to help stimulate growth. Global equities experienced respectable gains for the quarter as investor sentiment improved, while global bonds declined marginally. Equities outperformed fixed income securities for the period as a whole. Canada’s economy remained on a slow, steady growth trajectory.

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  • Jan
    3
    2013

    The U.S. Fiscal Cliff: A Deal of Sorts

    Despite the partial solution, we view the progress as a positive for the U.S., Canadian, and international economies.

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  • Jan
    2
    2013

    Markets Climb a Cliff of Worry

    Despite all the political and economic uncertainties in the world, financial assets registered robust gains in 2012. We expect 2013 to be characterized by improved global economic growth, less financial-market volatility in Europe and some calming of the political waters in the U.S. and elsewhere. Canada’s economy is expected to continue on its slow, steady growth trajectory.

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  • Dec
    18
    2012

    November 2012 Monthly Commentary

    Investor focus remained on the looming “fiscal cliff” in the U.S. and on ongoing worries surrounding the fate of the eurozone in November. Major central banks once again remained accommodative in an effort to help stimulate growth. 

    [... More]

  • Nov
    27
    2012

    Fiscal Cliff — The U.S. May Not Dive Off, But It's Not Climbing Either

    A series of large spending cuts and tax increases, collectively referred to as the “fiscal cliff,” are set to kick in on January 1, 2013. If they do, they have the potential to tip the U.S. economy into recession. SEI believes the possibility of going completely over the cliff is unlikely. It is more likely that U.S. legislators find a way of avoiding the worst-case scenario, possibly delaying automatic actions in order to give politicians more time to negotiate a compromise.

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  • Nov
    19
    2012

    Noise, News and Investment Strategy

    The headline news is currently filled with an overwhelming volume of scary, negative stories. Investment professionals often refer to this as “noise.” Rather than providing insight or direction, the net effect is often to simply cause investors to want to take action. Understanding the news behind the noise is the key to making intelligent investment decisions that match your investment objectives regardless of the current environment.

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  • Nov
    9
    2012

    U.S. Election Results: Similar Configuration, Same Challenges

    After a long, gruelling and occasionally bitter campaign, Election Day in the U.S. has finally come and gone. President Obama won re-election, the Democratic Party added marginally to its majority in the Senate, and the Republican Party retained control of the House of Representatives. The immediate political challenges facing the country—most notably the “fiscal cliff,” a package of federal tax hikes and spending cuts scheduled to occur early in 2013—have been apparent for over a year. The divided government must address long-term budget concerns without derailing a multi-year but still-fragile economic recovery. How effectively the President and current or subsequent Congress deal with these challenges remains to be seen. [... More]

  • Nov
    8
    2012

    October 2012 Monthly Commentary

    Focus remained on Europe, the upcoming U.S. elections and slowing growth in China in October. Leading central banks remained accommodative in October as part of continued efforts to help stimulate global growth. Global equities and bonds both experienced losses in the month, with fixed income performing marginally better, as investor sentiment waned. Within fixed interest, emerging market debt and high-yield bonds did best. [... More]

  • Oct
    12
    2012

    Third Quarter 2012 Market Update

    The financial markets were once again dominated by events in Europe and concerns about the global economic outlook, but central bank actions helped to bolster investor sentiment. Market activity and trading volumes slowed at mid-quarter due to the summer holidays, pushing volatility to lows unseen for several years. Global equities and bonds both experienced gains in the quarter, with equities pulling ahead as riskier assets returned to favour. Within fixed income, emerging market debt and high-yield bonds did best. [... More]

  • Oct
    2
    2012

    Economic Outlook: Central Banks to the Rescue

    Central banks have taken significant steps to continue on a course of accommodative monetary policy, providing extra time for countries to make necessary reforms. Strong demand for yield has kept bond prices high and yields near all-time lows. Emerging markets appear attractive, while we expect the euro to slip versus the U.S. dollar and commodities to rise as uncertainties around U.S. politics and the European debt crisis continue to rule. [... More]

  • Sep
    19
    2012

    August 2012 Market Update

    Summer holidays meant a quiet month as market activity and trading volumes slowed. Riskier assets came back into favor thanks to stronger support from central banks. [... More]

  • Aug
    23
    2012

    The Bottom Line: Plenty of Uncertainty Ahead

    The Portfolio Strategies Group has provided an update on the economic outlook. They note that there is still a great deal of uncertainty around economic fundamentals and policy actions, while markets have priced in some fairly optimistic expectations. If markets are disappointed on either the economic or policy fronts in the months ahead, risk assets could take a tumble. [... More]

  • Aug
    16
    2012

    July 2012 Market Update

    A degree of calm returned to the financial markets in July, but disappointing economic data ensured a subdued mood. The European Central Bank’s “whatever it takes” commitment  to save the euro helped buoy sentiment at month end. Global equities and bonds posted marginal gains. [... More]

  • Aug
    9
    2012

    Standard Chartered Scandal to Have Little Impact on SEI Funds

    On August 6 New York’s bank regulator threatened to revoke Standard Chartered PLC’s state license for alleged money-laundering violations involving Iran.  This is the latest shoe to drop in the U.K. banking scandals that have also involved Barclays and HSBC. SEI has only a 0.01% position in a single fund (EAFE Equity), so the scandal will have no material impact. [... More]

  • Aug
    9
    2012

    Second Quarter 2012 Market Update

    Optimism turned sour in April and reached panic levels in May when concerns about economic and political problems in the eurozone resurfaced with a vengeance. Events surrounding the French and Greek elections led to increased uncertainty, as did the deepening eurozone debt crisis when troubles in Spain and Italy hit the headlines. Economic data released during this time painted an uncertain picture and seemed to indicate a pause in global economic growth. [... More]

  • May
    22
    2012

    April 2012 Market Update

    Investor confidence deteriorated due to concerns about the eurozone. Global bonds outperformed all other asset classes as risk appetite waned. Global equities struggled, with cyclical and riskier stocks lagging the most. [... More]

  • May
    10
    2012

    Goals-based Investing: Aligning Life and Wealth

    Goals-based investing offers a powerful tool to help steel clients against market fear and uncertainty by better managing human preferences, biases and behaviours that can undermine their financial success. By helping clients invest according to their unique needs, desires and time horizons in a way that encourages them to look beyond intermittent market volatility, financial advisors can differentiate themselves from the crowd and improve their own odds for long-term success. [... More]

  • Apr
    17
    2012

    First Quarter 2012 Market Update

    Since the beginning of the year, equity markets around the world have rallied strongly at the expense of the overvalued bond market. Two factors seem to have driven this improvement in risk appetite. First, the European Central Bank (ECB) opened up the policy toolkit when it introduced the Long-Term Refinancing Operation (LTRO), injecting monetary stimulus and liquidity into European banks. This ultimately tamed yields on troubled sovereign debt. Second, U.S. macroeconomic data improved, convincing investors that the U.S. may be able to lead a global recovery. [... More]

  • Feb
    14
    2012

    The Five Stages of Greece

    Consistent with the Five Stages of Grief model, we believe that the ‘fifth stage of Greece’ will involve acceptance, by the troika and Greece and that the latter must depart from the single-currency union. We do not believe that departures by Greece or other periphery nations will lead to the collapse of the eurozone, however. [... More]

  • Sep
    1
    2011

    A Wild Ride: Taking a Closer Look at Recent Market Volatility

    Despite the recent volatility, our view of the markets remains intact. Strategically, the global economy appears to have entered a soft patch from which we expect it to emerge without entering recession. For investors, times like these underscore the importance of employing a time horizon that is appropriate to your objectives, implementing an appropriate asset allocation and maintaining a disciplined approach to portfolio rebalancing. [... More]

  • Aug
    17
    2011

    A Brief History of Market Turbulence

    Economic and financial crises have been a regular feature of monetary economies throughout history. While no two have been exactly alike, they tend to share some common characteristics. Read about some key lessons that investors can take away from such comparisons. [... More]

  • Aug
    12
    2011

    Investment Update: The Summer of Our Discontent II

    The current problems with the global economy are cause for concern, but not cause for panic. [... More]

  • Jul
    21
    2011

    U.S. Debt Ceiling: The Clock is Ticking

    The need to raise the debt ceiling is dominating the news. Due to the severe consequences of late or no action by Congress, we believe an agreement will be reached by the prescribed deadline. [... More]

  • Jul
    21
    2011

    Commentary: The Case for High Yield

    We believe the recent flows out of high-yield funds are not justified by the credit fundamentals, as indicated above, and that an attractive value proposition has been created for astute investors. This is an asset-class story, not a fund strategy story. [... More]

  • Mar
    16
    2011

    Japan: Too Early to Tell

    Japan, the third-largest economy in the world, has endured earthquakes, a tsunami and multiple nuclear reactor failures. The long-term downstream consequences will not be clear for quite some time. Gross domestic product (GDP) will be negatively impacted in the short term, but rebuilding should help economic activity rebound. [... More]

  • Oct
    5
    2010

    Comparing Recessions: U.S. "Great Recession" vs. Japanese "Lost Decade"

    A spate of economic data raised concerns that the U.S. economy is facing a “lost decade” like the one Japan experienced from 1991-2001. While we see similarities, a closer look reveals significant differences which we believe ultimately render them uncomparable. [... More]

  • May
    7
    2010

    An Update on the Greek Sovereign Debt Crisis

    In the past few weeks, concerns about whether or not Greece will default on payments related to its sovereign debt have reached a fever pitch. The Dow Jones Industrial Average plunged nearly 1,000 points before recovering significantly, ending the day down just over 300 points. [... More]

  • Oct
    27
    2008

    Presidential Elections and the Stock Market

    As volatile as the markets and economy have been, investors wonder what a victory for either candidate might mean to them financially. While that is nearly impossible to predict with any sense of certainty, history can tell us a great deal about how the equity markets have reacted post election. [... More]