Market Update

Mark Nickel, Chief Investment Officer and Senior Vice President, chairs Hilliard Lyons’ Investment Strategies Group. He holds degrees from the University of Louisville and University College Dublin (Ireland) and the CFP® designation. The Investment Strategy Group (ISG) meets monthly to consider the current financial, economic, and political landscape. ISG guides and supports the firm’s Financial Consultants with the goal of helping clients like you reach your long-term financial goals.

Greetings and Happy New Year from the Investment Strategies Group at Hilliard Lyons

Mother Teresa is quoted as saying “None of us, including me, ever do great things. But we can all do small things, with great love, and together we can do something wonderful.” Here at Hilliard Lyons, a network of passionate professionals brings together their skills and expertise to the table and collaborate daily. Our “something wonderful” is providing financial guidance to our clients, with the goal of long-term wealth creation and increased financial peace of mind.

A manifestation of this collaborative culture is the home office Investment Strategies Group. We meet monthly, bringing together professionals with diverse backgrounds ranging from equity and fixed income research to technical and tactical expertise to portfolio management and investment product experience. While this thought leadership and support network has existed at Hilliard Lyons since our founding, we are strengthening our bond with clients and advisors by initiating a monthly newsletter.

This month’s roundtable was a mix of looking back at 2017 and looking ahead to 2018. A consensus surprise from this past year was the wave of attention that Bitcoin and cryptocurrencies garnered from both the media and investing public, effectively establishing a new asset class. In response to this development, Hilliard Lyons published an educational piece, The Bitcoin Papers: A Hilliard Lyons Perspective, which you can get from your Financial Consultant. In addition, the group expressed its surprise with strong equity returns and low market volatility despite a noisy Washington D.C., North Korean uncertainty, and the Fed’s three rate increases and balance sheet normalization.

For 2018, ISG is guardedly optimistic about the global economy based on current economic data and support from central banks around the world. Nonetheless, the group is keeping a sharp eye on domestic inflation as a potential brake on current momentum. We remain concerned that valuations across US financial markets are elevated. But positive impacts from the recent tax reform, along with synchronized global economic strength, may keep valuations high. We see pockets of relative value in international markets and value-oriented equities, which have lagged in recent years.

In closing, let me extend the Investment Strategies Group’s best wishes for a rewarding new year. We look forward to working more closely with you and your Financial Consultant in 2018 and beyond.

Mark Nickel
Hilliard Lyons
Senior Vice President
Chief Investment Officer

Important Information about This Newsletter

Each client’s investment needs, risk tolerance, and goals are different. This newsletter is not meant to be advice for any specific investor. Nothing in it should be construed as an offer to sell, or a solicitation of an offer to buy, any securities. This should not be used as the sole basis for an investment decision. Any opinions or estimates are subject to change without notice. For information about how any of this information applies to your personal financial situation, please contact your Financial Consultant.

Past performance is not a guarantee of future results. Although the information provided to you in this newsletter was obtained or compiled from sources that we believe are reliable, J.J.B. Hilliard, W.L. Lyons, LLC cannot, and does not, guarantee that the information or data is accurate, timely, valid, or complete.

All investing involves risk, including the possible loss of principal. You should carefully consider investment objectives, risks, charges, and expenses of any investment before investing. Diversification and asset allocation do not guarantee a profit or guarantee against a loss.

Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market or economic developments. The bond market is also volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect can be more pronounced for longer-term securities.) Fixed income securities also carry inflation risk, liquidity risk, call risk, and credit and default risks.

J.J.B. Hilliard, W.L. Lyons, LLC | Member NYSE, FINRA & SIPC