Take a Look Around - Who Are You Surrounding Yourself With?
We hear some version of it all the time, “you are the sum of the five people you spend the most time with.” You want to surround yourself with people who have achieved the things you want to achieve, or at least have the same aspirations that you do. We pick up on their behaviors and habits. We get to opportunity to connect with others in their network. And, they help us see things from a whole new perspective. So, when you take a look around, who are you surrounding yourself with?
Smarter than you
Russell Simmons advised us, “Surround yourself with people who are smarter than you.” You’ve heard the saying that if you are the smartest person in the room, you’re in the wrong room. You need to surround yourself with people who are smart enough to challenge you. You want to be around people who you can learn from, people who have had experiences that are fascinating and backgrounds that are full of lessons learned.
Believe in you
Brian Koslow told us, “Surround yourself with people who believe in you.” While you don’t want to be the smartest person in the room, you do want to surround yourself with those who believe in you and can see what you are truly capable of. When people believe in you, they want the best for you. You never want to surround yourself with those who are only looking out for their own best interests. Surround yourself with people who inspire you to become better and ignite a fire in you to achieve your loftiest dreams.
Sarah Gavron stated, “Surround yourself with people who support you. Find champions.” To go along with believing in you, you want to surround yourself with those who are supportive of you. You need to find cheerleaders who are on your side. You do not, however, need to surround yourself with ‘yes men’. You need people who will be honest with you; the good; the bad; and the ugly, but will be there standing by your side just the same.
Take a Look Around
Who are you surrounding yourself with? Are they smarter than you? Do they believe in you? Do they support you? Find people who will challenge you but who also have your best interests at heart and believe in you. And, at the end of the day, remember that it is a two-way street. We benefit as much from sharing our knowledge with and challenging others, believing in them and encouraging them to chase their dreams, and standing by their side supporting them just as much, if not more than, them being there for us.
Top Picks in Asset Allocation
Written b: John Bilton, Head of Global Multi-Asset Strategy, Multi-Asset Solutions
As global growth broadens out and the reflation theme gains traction, the outlook brightens for risky assets
Four times a year, our Multi-Asset Solutions team holds a two-day-long Strategy Summit where senior portfolio managers and strategists discuss the economic and market outlook. After a rigorous examination of a wide range of quantitative and qualitative measures and some spirited debate, the team establishes key themes and determines its current views on asset allocation. Those views will be reflected across multi-asset portfolios managed by the team.
From our most recent summit, held in early March, here are key themes and their macro and asset class implications:
Key themes and their implications
Asset allocation views
For the first time in seven years, we see growing evidence that we may get a more familiar end to this business cycle. After feeling our way through a brave new world of negative rates and “lower for longer,” we’re dusting off the late-cycle playbook and familiarizing ourselves once again with the old normal. That is not to say that we see an imminent lurch toward the tail end of the cycle and the inevitable events that follow. Crucially, with growth broadening out and policy tightening only glacially, we see a gradual transition to late cycle and a steady rise in yields that, recent price action suggests, should not scare the horses in the equity markets.
If it all sounds a bit too Goldilocks, it’s worth reflecting that, in the end, this is what policymakers are paid to deliver. While there are persistent event risks in Europe and the policies of the Trump administration remain rather fluid, the underlying pace of economic growth is reassuring and the trajectory of U.S. rate hikes is relatively accommodative by any reasonable measure. So even if stock markets, which have performed robustly so far this year, are perhaps due a pause, our conviction is firming that risk asset markets can continue to deliver throughout 2017.
Economic data so far this year have surprised to the upside in both their level and their breadth. Forward-looking indicators suggest that this period of trend-like global growth can persist through 2017, and risks are more skewed to the upside. The U.S. economy’s mid-cycle phase will likely morph toward late cycle during the year, but there are few signs yet of the late-cycle exuberance that tends to precede a recession. This is keeping the Federal Reserve (Fed) rather restrained, and with three rate hikes on the cards for this year and three more in 2018, it remains plausible that this cycle could set records for its length.
Our asset allocation reflects a growing confidence that economic momentum will broaden out further over the year. We increase conviction in our equity overweight (OW), and while equities may be due a period of consolidation, we see stock markets performing well over 2017. We remain OW U.S. and emerging market equity, and increase our OW to Japanese stocks, which have attractive earnings momentum; we also upgrade Asia Pacific ex-Japan equity to OW given the better data from China. European equity, while cheap, is exposed to risks around the French election, so for now we keep our neutral stance. UK stocks are our sole underweight (UW), as we expect support from the weak pound to be increasingly dominated by the economic challenges of Brexit. On balance, diversification broadly across regions is our favored way to reflect an equity OW in today’s more upbeat global environment.
With Fed hikes on the horizon, we are hardening our UW stance on duration, but, to be clear, we think that fears of a sharp rise in yields are wide of the mark. Instead, a grind higher in global yields, roughly in line with forwards, reasonably reflects the gradually shifting policy environment. In these circumstances, we expect credit to outperform duration, and although high valuations across credit markets are prompting a greater tone of caution, we maintain our OW to credit.
For the U.S. dollar, the offsetting forces of rising U.S. rates and better global growth probably leave the greenback range-bound. Event risks in Europe could see the dollar rise modestly in the short term, but repeating the sharp and broad-based rally of 2014-15 looks unlikely. A more stable dollar and trend-like global growth create a benign backdrop for emerging markets and commodities alike, leading us to close our EM debt UW and maintain a neutral on the commodity complex.
Our portfolio reflects a world of better growth that is progressing toward later cycle. The biggest threats to this would be a sharp rise in the dollar or a political crisis in Europe, while a further increase in corporate confidence or bigger-than-expected fiscal stimulus are upside risks. As we move toward a more “normal” late-cycle phase than we dared hope for a year back, fears over excessive policy tightening snuffing out the cycle will grow. But after several years of coaxing the economy back to health, the Fed, in its current form, will be nothing if not measured..
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This document is a general communication being provided for informational purposes only. It is educational in nature and not designed to be a recommendation for any specific investment product, strategy, plan feature or other purpose. Any examples used are generic, hypothetical and for illustration purposes only. Prior to making any investment or financial decisions, an investor should seek individualized advice from a personal financial, legal, tax and other professional advisors that take into account all of the particular facts and circumstances of an investor’s own situation.
J.P. Morgan Asset Management is the marketing name for the asset management business of JPMorgan Chase & Co and its affiliates worldwide. Copyright 2017 JPMorgan Chase & Co. All rights reserved.
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