Publications
Our talented team of investment professionals regularly create and distribute educational materials delivering timely data, perspectives, and insight on the markets and related topics.
FEG Insight: Navigating the OCIO Landscape
The outsourced chief investment officer (OCIO) investment model, with several notable advantages, continues to attract a growing number of institutional and nonprofit organizations. In this comprehensive guide, we provide key points from an insider’s perspective to help institutional investors evaluate OCIO providers.
Third Quarter 2022 Private Capital Quarterly Review
The Great Reset of 2022 has had a meaningful impact on private debt markets. Lower prices for bank loans and high yield bonds have ushered in a wave of new distressed debt funds as managers look to build war chests for a potential downturn.
Research Review: October 2022
The concluding quarter of 2022—one of the most tumultuous calendar years across financial markets in recent memory—started strong for risk-seeking investors, particularly those emphasizing domestic markets. While some of this strength has since dissipated in the early trading activity of the first half of November, performance across the major asset classes and categories mostly reflected a risk-on tone in October. The Federal Reserve’s (Fed’s) 75-basis-point increase to the policy rate on November 2, as well as hawkish near-term forward guidance, affirmed the Fed’s steadfast pursuit of restoring price stability amid the most severe cost of living crisis since the early 1980s.
Inflation Challenges Present Opportunities
President Biden signed into law the Inflation Reduction Act (IRA) of 2022, allocating $369 billion for energy security and climate change. The IRA is projected to reduce total U.S. greenhouse gas emissions 40% by 2030, but public dollars are not enough to address the systemic challenges of climate change. Investments addressing various issues areas may help investors meet their double-bottom line of earning returns while also supporting an important need.
Interest Rates and The Great Reset
FEG explains the significant rate hikes we have seen in 2022 to try and counter inflation, the two main elements driving fixed income returns lower, and thoughts on how investors should position their fixed income portfolios.
Research Review: Third Quarter 2022
The third quarter of 2022 provided little respite for investors hoping to see a change in trend across the financial markets after significant downside volatility in the year’s first half. While a relief rally was witnessed in July, the positive sentiment spanning both risk-oriented and high-quality assets during the month reversed course in August and September, with most major equity index levels establishing fresh year-to-date lows and interest rates ascending to the highest level in more than a decade. Stubbornly high inflation, historically tight labor market conditions, and a continued imbalance between aggregate demand and available supply were critical factors behind increased tightening efforts by the Federal Reserve (Fed) during the quarter.
September 2022 Market Update
For over a decade, markets have benefited from low interest rates and valuations. Many may recall that the Fed struggled to get inflation to reach its goal of 2%. Unfortunately, many droughts end with floods, and a flood of inflation has altered the outlook for interest rates and economic growth, impacting bonds, equities, and other assets.
Research Review: August 2022
In late August, the Fed hosted its annual economic symposium in Jackson Hole, Wyoming, culminating in a brief speech by Chair Powell. In his remarks, the chairman shared three lessons learned from the management of monetary policy during the last high inflationary environment from the 1970s and 1980s. His third lesson, “…we must keep at it until the job is done,” invoked a sense of Volcker-era inflation-fighting resolve.
Second Quarter 2022 Private Capital Quarterly Review
The second quarter saw the wildly successful premiere of Top Gun: Maverick, the sequel to the original Top Gun from 1986. In an early scene, Captain Pete “Maverick” Mitchell took an SR72 Darkstar prototype aircraft past the authorized speed of Mach 10. The plane’s inability to withstand the high speed resulted in it effectively blowing up, though Maverick ejected and safely walked away. One cannot help but wonder if the current situation in the venture capital market is similar. After years of record-high valuations fueled by what seemed to be an endless supply of capital and willingness for risk-taking, a new era of venture capital could be on the horizon.
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Market Commentary: Third Quarter 2022
For the third consecutive quarter, traditional asset classes and categories endured significant volatility, with most corners of the financial markets suffering performance losses amid a tense geopolitical backdrop, weakening economic fundamentals, and further tightening actions by the Federal Reserve (Fed). In response to a historically tight labor market, stubbornly high inflation, and a persistent imbalance between aggregate demand and available supply, the Fed doubled the pace of quantitative tightening in September and issued two 75-basis-point hikes to the federal funds rate, formally placing this key policy rate above the “neutral” level and into restrictive territory.
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