Where are the Investment Opportunities in 2019?

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Nov 20, 2018, 09:00 ET

RBC Wealth Management-U.S. Global Outlook report explores market conditions and opportunities in U.S. equities and fixed income

MINNEAPOLIS, Nov. 20, 2018 /PRNewswire/ - Following nine straight years of economic expansion, the third-longest stretch since World War II, some investors are starting to wonder how much longer it can last. While the U.S. economy is in the late stages of what will probably go down as the longest-ever economic expansion, there remain ample opportunities in the market, according to RBC Wealth Management's Global Insight 2019 Outlook.

"None of the major indicators we monitor are signaling that a U.S. recession is on the way or about to start, which means there are still opportunities for investors," said Kelly Bogdanov, vice president and portfolio analyst at RBC Wealth Management. "Still, we believe that investors should lean away from the riskiest equities and invest in higher quality companies with reasonable valuations."

RBC Wealth Management's Global Insight 2019 Outlook, compiled by RBC's Global Portfolio Advisory Committee (GPAC) showcases analysts' unique perspectives and highlights compelling opportunities for investors in the year ahead.

Highlights include:

RBC's investment stance: RBC Wealth Management's view for global equity and fixed income markets in 2019, including specific regional outlooks from on-the-ground experts around the world. The Outlook also includes thoughts on currencies for the year ahead.
Equity investing in the "late cycle": The later stages of the very extended economic cycle have further to run—at least another year, perhaps longer. What should an equity investor do? "Make hay while the sun shines?" Or prepare to hunker down?
A game plan for de-risking portfolios: It's prudent to avoid complacency and prepare for choppier waters while the seas remain calm by charting a course to de-risk portfolios. RBC Wealth Management explores how reducing credit risk in fixed income portfolios is a good place to start.
U.S.-China trade dispute: Fallout from the U.S.-China trade tensions continues to roil markets, especially in Asia, and there's an increasing risk the dispute goes on well into 2019 and possibly beyond. Moreover, it's important to understand that there's a sea change underway in U.S.-China relations that goes well beyond trade.
Artificial intelligence: This report sheds light on artificial intelligence (AI), separating the hype from reality about what AI can and cannot do today; digging into what's creating a perfect storm for the explosion of AI technology today and why AI has become relevant, and what it means for investment strategy.
Infrastructure investing in the 21st century: Infrastructure investing is often brushed off as being yesterday's story. With the world's infrastructure in line for a 21st century upgrade, and the private sector filling more and more financing gaps, this report looks at how this theme can enhance the infrastructure of investment portfolios.

The report also explores what may happen with interest rates in the year to come and outlines the impact such moves could have on the market and on investors.

"It's challenging to gauge the level at which higher interest rates lead to a slowdown in economic activity, but as we reach a more advanced stage of the economic cycle, it can result in higher volatility," said Craig Bishop, vice president and lead strategist, U.S. Fixed Income Strategies at RBC Wealth Management. "We believe now is a good time for investors to start reducing credit risk in fixed income portfolios, as it's best to prepare for choppier waters while the seas remain calm."

About RBC Wealth Management – U.S.

In the United States, RBC Wealth Management operates as a division of RBC Capital Markets, LLC. Founded in 1909, RBC Capital Markets, LLC. is a member of the New York Stock Exchange, the Financial Industry Regulatory Authority, the Securities Investor Protection Corporation, and other major securities exchanges. RBC Wealth Management has $353 billion in total client assets with approximately 1,800 financial advisors operating in 200 locations in 42 states.

This material is for informational purposes only and does not constitute investment or tax advice. Past performance is not indicative of future results.

SOURCE RBC Wealth Management - U.S.