According to Northern Trust's Chief Investment Officer for Wealth Management Katie Nixon, the top 10 reasons why the U.S. stock market is not in a bubble can be summarized in a countdown list as follows:
No. 10
Valuations far from peak and supported by low rates
No. 9
Dividend yield far from trough and 2 percent yield competitive with treasuries
No. 8
Cash flow multiple supported by strong growth in cash flow
No. 7
S&P on pace to deliver 9 percent + earnings increase in next 12 months
No. 6
Profit margins sustainable with low wage inflation and low interest expense
No. 5
Cash on corporate balance sheets continues to be used for shareholder friendly activities - especially stock buybacks
No. 4
Global growth outlook slow but sustainable
No. 3
Inflation very moderate and inflation expectations well anchored
No. 2
US economy a relative bright spot on global economic stage
And No. 1
Fed on hold until well into 2015 if not beyond
Katie’s bottom line: Stay the course, but expect more volatility, which is NORMAL!
· Katherine Nixon is the Chief Investment Officer for the Wealth Management business at Northern Trust, where she leads the national investment management practice for the firm’s Wealth Management business from its Chicago headquarters.
· Katie’s responsibilities include investment policy development with a particular focus on portfolio construction and implementation.
· She also directs the investment management activities of over 200 Northern Trust portfolio managers across the firm’s 79-office Wealth Management franchise.
· Prior to joining Northern Trust, Katie worked at U.S. Trust Company for eighteen years in several investment related capacities, including Managing Director and Division Manager in the Wealth Management Division in New York, overseeing a group of portfolio managers and client service officers with total combined assets under management in excess of $7 Billion.
· Katherine received her B.A. from Wellesley College and her M.B.A. in Finance from New York University, Stern School of Business where she graduated with distinction, Beta Gamma Sigma, and was a Stern Scholar.
· She has received the designations of both Certified Investment Management Analyst (CIMA®) and Certified Private Wealth Advisor ( CPWA®) from the Investment Management Consultants Association.
· Further, she has been awarded the Chartered Financial Analyst (CFA) designation, and is also a member of the New York Society of Security Analysts and the Investment Management Consultants Association (IMCA).