Europe could be one big loser in all this, however. Between Brexit and populism in the euro area to shifts in leadership in Germany and the European Central Bank, the region is plagued by economic and political risk. That’s prompting Neuberger and Northern Trust to look elsewhere for returns.
“We are going to need greater conviction in the growth outlook to increase exposure to European stocks,” according to Sturkenboom.
Regardless, buy-and-hold strategies could upend investors this year as late-cycle risks grow, Knutzen warns.
“It’s still going to be volatile. As optimistic as people are starting to get, there’s still good reason to be cautious.”
This article was provided by Bloomberg News.