WEALTHTRACK

Part 2 of 2 Candid career advice from three super successful women portfolio managers. Causeway Capital’s Sarah Ketterer, Capital Group’s Karen Choi, and Canyon Partner’s Robin Potts share their victories, setbacks, and strategies as they tear down the pink wall.   WEALTHTRACK #1849 published on June 3, 2022  

Part 1 of 2 The investment opportunities surfacing in the volatile stock, bond, and real estate markets. Causeway Capital’s Sarah Ketterer, Capital Group’s Karen Choi, and Canyon Partner’s Robin Potts share their perspectives. WEALTHTRACK #1848 published on May 27, 2022

2022 has been a rough year for investors as financial markets have declined across the board. No matter what the market performance, investors continue to favor passive index funds over actively managed ones.  Investors continue to favor ETFs, and exchange-traded funds over mutual funds. The vast majority of funds in ETFs are in passive strategies, but there’s an interesting divergence occurring. One of the fastest-growing segments in the ETF universe is actively managed ETFs.  This week’s guest is involved in both actively managed mutual funds and ETFs and one of his main responsibilities is identifying best-in-class managers for both. He is Kristof Gleich, President and Chief Investment Officer of Harbor Capital Advisors. Prior to joining the firm in 2018, he was Global Head of Manager Selection at JP Morgan Chase.  Harbor Capital is well known within the investment management industry but not in the general public. Begun as the pension advisory arm of old-line packaging manufacturer, Owens-Illinois, Harbor Capital became independent over 30 years ago. It is known for choosing top-quality independent money managers to run specific mutual funds under the Harbor Capital name.  It currently oversees $55 billion of targeted strategies. It also recently launched a suite of actively managed ETFs, some with unusual strategies which we will discuss.    I began the interview by asking Gleich to take us through the process of choosing money managers to partner with, who have what he calls an “alpha edge”.    WEALTHTRACK #1847 broadcast on May 20, 2022 More info:

If you were to ask investors to name the biggest headwinds facing the markets,   higher inflation and interest rates and their potentially negative impact on corporate earnings would top the list. Just about everyone on Wall Street agrees we are in a new era of higher levels of both. But this week’s guest believes there is another area that poses even greater challenges to the global economy and markets: energy.   Energy is under enormous pressure on numerous fronts: geopolitical, production,  distribution, and financing. It’s a combination creating a new era of energy insecurity.  Our guest is Tom Petrie, a long-time thought leader in the oil and gas industry.    Since 2012 he has been Chairman of Petrie Partners, an influential investment banking and consulting boutique to the industry.  What is happening with U.S. energy independence? After decades of decline, U.S. oil production picked up significantly in the last decade and a half, largely thanks to the shale oil revolution, to the point where it surpassed Russia and Saudi Arabia’s output to become the world’s largest oil producer.  Despite that achievement, Petrie says the U.S. and the rest of the world are now approaching a possible energy crisis caused by a number of factors. One of the biggest: some new geopolitical realities, what he calls geopolitical fragility. We will discuss them at length as well as why he believes the current elevated levels of oil prices are unsustainable and why the outperformance of traditional energy stocks is as well!  WEALTHTRACK #1846 broadcast on May 13, 2022 More Info: https://wealthtrack.com/rising-global-energy-insecurity-and-its-impact-with-industry-thought-leader-tom-petrie/ Bookshelf: Following Oil: Four Decades of Cycle-Testing Experiences and What They Foretell about U.S. Energy Independence https://amzn.to/3FM4ymZ

Are you feeling at all overwhelmed by the pace and degree of change we are experiencing in the world, the economy, the markets, life in general? A series of head-spinning turns in events ranging from rising inflation and interest rates, Russia’s relentless and brutal assault on Ukraine, and a surprise leak of a draft of a  momentous Supreme Court opinion are perfectly encapsulated by the dramatic market action of the last two days. After the Federal Reserve raised short-term interest rates by half a percentage point (50 basis points) on Wednesday the Dow experienced its largest gain since 2000, up more than 900 points, nearly 3% to 34,061.06. Investors were evidently reassured by Fed Chairman Jerome Powell’s comments that the central bank was not “actively considering” raising rates by a sharper three-quarters of a percent (75 basis points). That reassurance turned to doubt on Thursday when the Dow made a U-turn, falling 1,063 points, a 3.1% drop, its largest decline this year. As we have covered in several recent WEALTHTRACK episodes there appears to be a new world order emerging on several fronts which calls for new investment approaches. But what will the new order look like? How lasting the changes, and what are the best investment responses? This week’s guest has the breadth, knowledge and experience to tackle all those questions and more. She is a long-time investment star who has never lost her influence or cool. She is Abby Joseph Cohen, now a professor at Columbia Business School, teaching the popular and oversubscribed “Future of the Global Economy” course which she has been doing as an adjunct professor since 2014. I am delighted she is with us to discuss the contours of the new world order and their impact on the economy and markets. WEALTHTRACK #1845 broadcast on May 06, 2022 Bookshelf: The Black Swan: Second Edition: The Impact of the Highly Improbable https://amzn.to/3w3OLvA

What do you do when your flagship fund goes from the top of its class to close to the bottom in a matter of weeks? From market trouncing to market lagging? That is the challenge facing this week’s guest.  Alex Umansky, Portfolio Manager of the Baron Global Advantage Fund which he launched at the firm of legendary growth manager Ron Baron in 2012. Umansky oversees about $2.4 billion dollars in assets at Baron Capital including $1.7 billion at his flagship Baron Global Advantage Fund. However, in mid-November of 2021, the bottom fell out for the majority of its holdings.  Global Advantage went from a 20% plus gain to a less than one percent gain by year-end, while its benchmark and competition fared much better. So far this year the fund is down 33% and lagging badly.   In a wide-ranging discussion, Umansky discusses what’s changed and what in his mind hasn't, which is why he is doubling down on some of his hardest-hit holdings and is convinced they will be long-term winners.   WEALTHTRACK #1843 broadcast on April 22, 2022

We are in a new era of higher inflation and the pressure is on the Fed! Inflation is running at 40-year highs and it’s coming from every angle: food, energy, services, goods, rents, and wages which are all increasing.   Is the Fed up to the challenge? Can it rein in inflation without causing a recession? What can we expect as borrowers and investors? We have lots of questions to ask this week’s guest but we know from his past performance he can take them all in stride.  Paul McCulley is currently an adjunct professor at Georgetown Business School where he teaches a very timely multi-disciplinary course combining law, economics, monetary policy, global finance and behavioral finance.   McCulley says this Fed has the courage to defeat inflation despite recession risk. WEALTHTRACK #1842 broadcast on April 15, 2022

The new era of higher inflation and interest rates is already proving to be a challenging one for investors. The first quarter of 2022 was the worst one in two years for the stock market. Inflation reached 40 year highs, and in response, the Federal Reserve raised interest rates for the first time since 2018 and is signaling an aggressive policy of multiple rate hikes in the months ahead. Then there are all the other disturbing and disruptive developments to consider: the extended impact of Covid on global growth, supply chain problems, Russia’s unprovoked war against Ukraine, and aggressive actions from China, North Korea and Iran. How to navigate these challenges as investors is the job of this week’s guest. She is an influential strategist, Savita Subramanian who has two leading roles at BofA Global Research. She is Head of Environmental, Social, and Governance (ESG) Research, the first in that position, and the Head of U.S. Equity and Quantitative Strategy. This is Subramanian’s first appearance on WEALTHTRACK so we will cover a lot of territory including why she believes the market is at a major inflection point. WEALTHTRACK #1841 broadcast on April 08, 2022 More Info: http://wealthtrack.com/new-strategies-for-a-major-market-inflection-point-with-influential-strategist-savita-subramanian/

As bonds suffer the worst quarter in more than four decades we are exploring one of the fastest-growing segments in the fixed income markets where demand is still accelerating. It's in ESG, environmental, social, and governance standards being applied to corporate and government bond issuers and specific issues themselves.  In part 2 of our interview with industry pioneer Steve Liberatore, we explore both ESG fixed income investing, as well as the relatively new area of impact investing where bond proceeds are directed to a specific project or goal and the results are measurable.    In the previous episode about the state of the bond market in general, still very timely, you’ll know that Liberatore is the lead portfolio manager and head of ESG/impact for global fixed income at Nuveen, the investment arm of TIAA and a pioneer in the field.  Liberatore will give us an update on socially responsible fixed income investing as well as a fascinating lesson on how impact investing works and the unusual opportunities in it.    WEALTHTRACK #1840 broadcast on April 01, 2022 More info: https://wealthtrack.com/why-impact-bonds-represent-opportunities-for-investors-with-industry-pioneer-steve-liberatore/ From the Bookshelf: Five Days in London: May 1940: https://amzn.to/3wXoC3w Citizens of London: The Americans Who Stood with Britain in Its Darkest, Finest Hour: https://amzn.to/3K1I17a

Part 1 of 2 The direction of inflation and interest rates are key to the performance of bond prices and they are in the midst of a massive change. The shift in direction has been most dramatic for inflation. After a decade of staying mostly below the Federal Reserve’s long-term 2% target, the Consumer Price Index recently soared nearly 8% year over year. Meanwhile, until very recently interest rates have remained near historic lows. Despite telegraphing it would for months, the Federal Reserve just raised its key short-term federal funds rate for the first time since 2018. And the short-term interest rate sensitive yield on the 2-year treasury note has risen accordingly while the longer-term 10-year Treasury yield has been more subdued. It now remains to be seen how aggressively the Federal Reserve will raise interest rates to dampen economic activity and rein in inflation. Its decisions will heavily influence the performance of bonds not just in the U.S. but also in the rest of the world. This week’s guest will update us on the prospects for the bond markets but also on the increasing influence of his specialty, sustainable bond investing, on performance. Steve Liberatore, a pioneer in ESG and impact bond investing explains what the new bond era means for investors in general and sustainable investing in particular. WEALTHTRACK #1839 broadcast on March 25, 2022 More info:https://wealthtrack.com/esg-bond-pioneer-steve-liberatore-explains-the-new-bond-era-and-esgs-role-in-it/ Bookshelf: The Splendid and the Vile: A Saga of Churchill, Family, and Defiance During the Blitz: https://amzn.to/3tES2RV Never Give In! Winston Churchill’s Greatest Speeches: https://amzn.to/3DqxrEt