Student of the Market: January
January 2022 highlights
- Money market assets still near historic peak: Money market assets peaked in May of 2021 at $4.8T, the highest level ever. Just 6 months later, at the end of November, money market assets were still near those levels ($4.6T).
- The inflation effect – asset allocation: Inflation is having an erosive effect on bond yields, with inflation coming in at 5.4% over yields in November (6.8% vs. 1.4%). What does this mean for the “40” in investors’ 60/40?
- Inflation even higher using older methodology: Inflation has been high recently, causing investors to worry. But, if we factored in changes made to the CPI calculation over the years, inflation would be much higher based on older methodologies.
Incorporating models, as well as technology, into your practice can help make things more transparent and uncover key areas your clients want to discuss, like risk. Learn more at our page dedicated to markets, models, and tech below.