Therefore, an asset allocation towards risky assets continues to be appropriate, the team said in a statement. Voya favors international over domestic equities at this stage of the global cycle as equity correlations between domestic and international equities remain low. They favor emerging markets over developed markets given the strong growth of the global economy, and favorable valuations.
The broader availability of consumer credit has reduced consumer liquidity constraints and allows for consumption smoothing over business cycles. That is, there has been less direct dependence on current disposable income, which has led to a less volatile consumption pattern, Voya said.
Voya believes that the United States remains in a low-growth environment, as the main sources of incremental growth would likely come from meaningful increases in labor force growth or in productivity.
Bernstein Capital Market Outlook, the private wealth management arm of AllianceBernstein, said 2017 may be the exception rather than the rule. The firm agrees in part with other positive outlooks, but says some volatility may come back into play. Most investors believe 2018 will reintroduce geopolitically induced volatility, similar to August 2015, when foreign markets fell overnight on fears of a China slowdown.