MainStay Market Minute: Opportunities in the Marketplace

Poul Kristensen and Charles Reinhard, Managing Directors for New York Life MainStay Investments, share their insights on some of the latest opportunities in the marketplace as well as some philosophies regarding currency and its unpredictable nature.
 
 
Poul Kristensen and Charles Reinhard, New York Life MainStay Investments
Poul Kristensen and Charles Reinhard, New York Life MainStay Investments
NEW YORK - Feb. 26, 2016 - PRLog -- Poul Kristensen and Charles Reinhard, Managing Directors for New York Life MainStay Investments, provide their opinions on some the latest opportunities they see in the marketplace.

However, Charles and Poul start off by prefacing that the opportunities they present are based on the premise that a growing global economy and a US economic expansion will continue alongside low inflation and very gradual interest rate increases by the Fed.   Given those conditions, Charles states that he sees opportunities in the high yield market, where historical data suggests a strong relationship between the starting yield and the annualized return over the next 5 years, due in large part to the total return coming from income generation.

In regards to currency, Poul states that the European Central Bank is set for more easing next month, and with the Japanese Yen remaining strong this year, it is considered a safe-haven currency which has benefitted from the market’s volatility and oil prices.  In looking at the state of the Euro versus the US dollar, Poul notes that the rates have returned to virtually the same position they were at late last year, after two off-setting moves essentially brought it back to the starting point.

Developed international equities is another area that Charles sees as opportunistic, as they exhibit attractive valuations when comparing prices to expected earnings over the next 12 months.  Overtime, it is expected that developed international equities will benefit from this valuation starting point.  The key, however, is what to do about the unpredictable nature of currency.

As Poul explains, philosophies vary when it comes to currency.  Some subscribe to the ‘do nothing’ approach, while others prefer a full currency hedge.  However, Poul believes a middle of the road approach is best with a 50% hedge to avoid potential extremes of big currency appreciation or depreciation.  It’s a philosophy that Charles says a lot of financial professionals are starting to adopt.

To watch this interview and future updates from New York Life MainStay, tune into Asset TV’s New York Life MainStay Investments Channel Page:  http://bit.ly/21wGPMY

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Matthew Bramowicz (Writer, Marketing Associate)
Asset TV
matthew.bramowicz@asset.tv
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