Broker Check

Positioning Your Portfolio

July 05, 2017
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We are halfway through 2017 so it’s time for our mid-year analysis of investment performance year to date, and our forecast of where we believe the US and world economy are heading.


In our last newsletter, we made the case that US stocks are expensive compared to historical valuations, and now is a better time than ever to be diversified. While diversification means we may have lower returns when the US stock market has a substantial up year, it often helps our performance when the US stock market is volatile.


In our forecast for the remainder of 2017, we believe that US stock market performance will be highly correlated to the ability of the US Government to pass meaningful tax reform. While economic growth has strengthened this year, we are cognizant that this is the third longest economic expansion in US history, meaning a pullback is long overdue. 


At Denver Wealth Management, we never attempt to time or predict markets in the short term, but we do make adjustments to your portfolio based on the long-term outlook for different markets.  As part of our process we follow three major financial institutions’ economic data and forecasts, and use their analysis to position your portfolio.


  • We rely heavily on Blackrock Institutional Research to provide ongoing market research and data. As a firm with $5.4 trillion in assets, they have a front-row seat to view money moving in and out of the market. We use their risk management software (named “Aladdin”) to test our portfolios through thousands of different scenarios.


  • JP Morgan Chase offers very consistent and thorough economic data available through their Guide to the Markets. This publication gives us incredibly valuable data on stock prices, bond yields, and foreign markets.


  • One of the reasons our financial professionals chose to affiliate with LPL Financial five years ago was to have access to their phenomenal research team. Attached you will find LPL’s forecast for the remainder of 2017, as well as their analysis of different asset classes. We do not invest based solely on LPL’s research, but we have found that their track record and process is consistent, and we pay close attention to their analysis.


No one investment research firm will be right all the time. This is why we are constantly reading, researching, and analyzing data from many large and experienced firms to work towards having your portfolio well-positioned for the future.


 LPL Midyear Outlook

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.