Investing in US Equities in Trump’s America

As tempting as it may be, predicting political outcomes and the resulting stock market move has no place in the rational investor’s toolkit

Dan Kemp 29 November, 2017 | 11:15AM
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Donald Trump has celebrated one year in office

US equities have hit 53 record highs in 2017, the equal highest streak in the 10-years since the financial crisis with some weeks still go to – 2014  also had 53 record highs. This boom in asset prices has resulted in a range of sentiments, with some respected pundits including Jeremy Siegel claiming that equities are still a bargain relative to bonds, while others such as Alan Greenspan declaring “we are moving into a different phase of the economy - to a stagflation not seen since the 1970s. That is not good for asset prices”.

Add to the mix Donald Trump, and it is little surprise the topic of market predictions are getting so many headlines. Yet, if Donald Trump’s one-year election anniversary has taught us any lesson, it must be the perils of forecasting. To demonstrate, we only need to reflect on his journey from an unlikely Republican candidate to an unlikely presidential nominee that eventually defeated Hillary Clinton to become president.

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About Author

Dan Kemp

Dan Kemp  is Chief Investment Officer, Morningstar Investment Management EMEA