2023 Long-Term Capital Market Assumptions
Time-tested projections to build stronger portfolios
Contents
3 Foreword
6 Executive summary
Back to basics
19 Macroeconomic assumptions
Inching forward: Lingering inflation, moderate growth
Thematic articles
30 The future of globalization
Globalization will evolve – but not unravel
41 Demographics and destiny
The challenges and opportunities of a 10 billion person planet
Assumption articles
56 Currency exchange rate assumptions
Rich U.S. dollar headed toward fair value
62 Fixed income assumptions
Bonds are back – after the biggest-ever drawdown
68 Equity assumptions
Better starting point, higher forecast returns
76 Alternative asset assumptions
Sourcing uncorrelated returns in a period of rising market risk
97 Volatility and correlation assumptions
Fixed income volatility rises; its diversification benefits weaken
104 Portfolio implications
Striking a balance: Strategic patience, tactical flexibility
Assumption matrices
112 U.S. dollar
2023 Estimates and correlations
114 Euro
2023 Estimates and correlations
116 Sterling
2023 Estimates and correlations
Appendix
120 Acknowledgments
122 Glossary