Investing with Insight

At Appleton, we value active engagement and interaction with financial advisors and clients. Investing with insight helps us meet client objectives. And by sharing our economic and market perspectives, we foster deeper relationships. Here’s what we’re talking about this month.

The Case for Adding Duration – November 2023

Appleton Partners Senior Vice President, Partner and National Sales Manager Jeff Johnson discusses municipal market opportunities and the associated risk-return tradeoffs at this stage of the interest rate cycle.

Review and Outlook

"The most important moment of the Federal Reserve meeting on January 31st was Powell’s response to the final question about the risks posed by economic strength. He indicated in no uncertain terms that the Fed was no longer very concerned about strong consumption or growth, since inflation had continued to fall the entire second half of the year despite a fast-growing economy..."
"December brought renewed talk of a Fed “pivot,” and growing expectations for Fed Funds rate cuts met only token resistance from Fed Chairman Jerome Powell..."
"Last month we flagged October’s Beige Book as a potential inflection point in economic activity, with the summer’s gangbuster’s growth seemingly slowing to a crawl in late September."

Economic and Market

"One of the unexpected challenges of managing fixed income portfolios is how much of the capital markets have an equity bias. From regulatory guidance to risk measurement conventions, much of the framework of the markets we trade in appears to have been written primarily with equities in mind..."
“This summer we started suggesting investors consider rethinking their bond portfolio duration. After abrupt selling pressure subsequently pushed longer yields up another 70 bps at the end of Q3 and into early October, more support for our view appears to have developed. If the argument was strong then, it is even more compelling now, with bond yields higher than they have been in nearly 20 years.”

Quarterly Perspectives

"The recent passing of legendary investor Charlie Munger has prompted many prominent investors to publicly reflect upon his wisdom. The human element was often central to Munger’s insights concerning investment decision-making, and he was a pioneer in the field of behavioral finance."
“Traffic is an inevitable part of urban American life as those of us who frequent highways in Greater Boston or most other metropolitan areas know all too well. Apologies for raising an irritating topic, but we feel there are useful parallels to be drawn between driving and investment decision-making.”
“Atisa Dipamkara, a revered 11th century Buddhist philosopher, once said, “The greatest wisdom is seeing through appearances.” His insight into looking beyond first impressions resonates in today’s investment world. While diversification has long been touted as a means of mitigating risk, we recognize that it is far from solely determined by the number of securities held in an index or portfolio.”

Video Briefs

The Case for Adding Duration – November 2023

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Municipal Market Conditions and Portfolio Strategy – June 2023

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Value Opportunities in a Challenging Environment – October 2022

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