- Washington’s pricing threats and global counterparts fuel the uncertainty and market risk.
- Investors are faced with potential stagflation, provoking a strategic asset allocation and cash management.
- Experts advise prudent active movements, promoting high -quality bonds and major technologies for recovery.
Washington’s pricing threats are real but not the only problem: the continuation counter-responses Other countries have transformed this trade war into a vicious circle that makes it difficult for any seasoned economist to call the end point. And this type of ambiguity makes the markets nervous.
There has been a significant revaluation of risks and a transition to the downward feeling for markets, said Jim Baird, director of investments at Plante Moran Financial Advisors. He serves customers with net Dorths from $ 500,000, which he calls the type “millionaire-Xe-door”. In other words, they are not yet in the ultrawealth fork where they can sit or use private investments.
This group of investors has sufficient exposure to public procurement so that it could seriously have an impact on their wealth. This is a difficult situation that has put fund managers at the forefront of rethinking their customers’ exhibitions in relation to their needs in the midst of a rapidly changing economic environment.
Baird does not expect a short -term recession but is concerned about the risk of stagflationWhen inflation And unemployment Both remain high. To do this, he assesses if customers have enough money to cover their monthly needs and the big payments they may have to come. This helps them avoid selling stocks when the market is down. It is generally known as emergency funds. But customers who are retired or approaching retirement should aim to have six to 12 months of their cash needs. As for those who still have a salary and who are not worried about losing it, carrying too much money does not make sense, he added.
It also involves customers on the allocation of strategic assets while examining their portfolio positioning. When the stock market is volatile, it could be an opportunity to move certain positions, he noted. But these decisions would be made according to the needs of an individual client. For example, if they do not have enough exposure in big traffic jamsThis could be the time to exceed this position while unloading other areas that could be used to tax -catching fine.
“The release of recent years, investors in equity, in particular, have behaved rather well,” said Baird. And so they can be in a decent position to reduce the risk of wallet without risking their ability to achieve their long -term goals and objectives. “”
For those who do not want to take too many risks on shares or who already depend on their investment portfolio, they advise them to rely on high -quality obligations which always provide sufficient return. But it does not offer longer obligations in case there is an increase in inflation.
Ken Mahoney, CEO of Mahoney Asset Management, advises those who have a clear wealth between $ 1 and $ 10 million in assets. It helps customers cut some of their posts since the end of last year and in 2025. But not because of commercial wars, in itself: it feared that the stock market has not seen any correction for some time and expected a decline at 10% at a given time.
While things seem dark at the moment, he has also prepared for a big change in the tone and politics of the president who could bring the markets back. Its strategy with customers has been to remain tactical while monitoring positive signs of change.
For those who have the impression of having missed the curve and the market has already turned for the worst, Mahoney says it is not too late. Investors can still make tactical movements. See this as a time when good things are on sale and go shopping for high quality actions.
It expects a rally to return to large technological actions like Apple, Microsoft and Nvidia when the market is starting to recover – although it cannot guarantee when it happens. But as these names are the most liquid stocks, institutions will add them to their portfolios as quickly as they have unloaded them, he said. These companies are also supported by fundamental solids, large balance sheets and heavy cash, and they remain the key to long -term technological innovations.
However, there are still risks on the market, which means that sectors like small caps may not be the place to go in search of sales. Mahoney only holds MAG 7 and potentially other stocks with a relative balance sheet.
“We are growth managers, so this is where we will stay focused to try to nibble on technology, and the keyword nicks there because it is not at all a place to become aggressive,” said Mahoney. “We like to buy high and sell higher and buy more confirmed force on the markets that we had in 2023 and 2024.”
Once the indexes are starting to make higher stockings, Mahoney would consider becoming slightly more aggressive because it is an early sign that the sale pressure is free. Another sign that he is looking for is the cooling of the CBOE volatility index, an expected volatility measure of the S&P 500.
In the meantime, for investors looking for a wider exposure, it suggests an average cost at a cost – buying fixed amounts at regular intervals – in the clues if they have time to stay on the market. Indeed, once we have corrected, you can gain an additional 10% of the overthrow, noted Mahoney. And if we remain in free fall, it means more actions at a lower price, he added.
That said, you will want money or what Wall Street calls “dry powder” to book so that you can buy. He recommends keeping this species on the money markets which can be liquidated at the nominal value of $ 1 at any time, making it a more flexible option on obligations.