A Statistical and Qualitative Review of Q1 2017 & Outlook for 2017

Key Q1 Takeaways:

  • The rally in risky assets continued into Q1 as animal spirits prevailed over yet-to-materialize policy changes.
  • Pension plan sponsors are benefitting from higher rates and higher equities. They are peeved however, by increasing PBGC premiums, which may lead to increased contributions.
  • Greater potential demand for long corporate bonds from higher expected contributions can provide support to this asset class over the next few months.
  • Investors are generally concerned about valuation levels across asset classes.
  • Changes in tax policy should bring secular changes to corporate capital structures.

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