Vanguard’s global outlook for 2022: A focus on balance
Perspectives and news
Mark Lahoda, Vanguard senior credit analyst
What return to work means (and doesn’t mean) for office space
Vanguard research suggests that the office is not going away, it’s evolving. Investing in office space, though more complex, may give active managers with deep fundamental analysis capabilities opportunities for outperformance. The return to work is likely to result in a new office normal that will vary by region, industry sector, and property class.
2022 economy and markets: 4 things to know
Vanguard offers perspective on U.S. stock valuations, the next peak in the Federal Reserve’s target for short-term interest rates, the property sector in China, and the COVID-19 Omicron variant.
The chip shortage will increasingly be about demand
Semiconductor shortages have been making an impact around the world. From a credit perspective, though, we are cautious on the semiconductor industry. With bond valuations of chip manufacturers becoming extremely tight, we see more value downstream among their customers, especially industrial equipment manufacturers.
Longevity and recurring health care costs in retirement
Personalized, realistic projections of longevity and health care costs in retirement could provide a better foundation for planning than conservative assumptions.
Research spotlight
Economics and markets
Vanguard economic and market outlook for 2022: Striking a better balance
Our annual forecast explains why we expect the global economy to slow, leaving full-year 2022 growth, in our base case, of 4.8%. It also explains why our 10-year market outlook is guarded, as reflected in the low-single-digit range of expected returns for a globally diversified, 60% stock/40% bond portfolio.
Megatrends: The deglobalization myth(s)
Vanguard’s Megatrends series examines fundamental shifts in the global economic landscape that are likely to affect the financial services industry and broader society. In this paper, Vanguard economists examine global trade and conclude that growth will likely slow, as it has since the global financial crisis, but not decline.
Diversification still works: Exploring the equity-bond relationship with K-means clustering
Employing machine-learning, Vanguard researchers found that government bonds have historically acted as a counterbalance in a stock-bond portfolio in periods when interest rates are low. Although in some months both stocks and bonds fall, the analysis suggests that this can be thought of as market noise.
Fine-tuning target-date funds for different goals
Most target-date fund series offer a single post-retirement asset allocation designed to help retirees replace a reasonable portion of pre-retirement income. In this paper, Vanguard researchers demonstrate that adding a second asset allocation could support additional goals for those with the resources and desire to pursue them.
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