Asset allocations: Continue to favor a defensive posture
Change from previous quarter
|U.S. large cap|
|U.S. small cap|
|Non-U.S. developed country|
|Investment grade / High yield / Floating rate|
|Residential mortgage credit|
|Commercial mortgage credit|
Currency viewsU.S. dollar versus
|Favor other||Neutral||Favor dollar|
Remain underweight to equity risk
Large-cap equity indexes look expensive and could face further downward earnings pressure.
High-yield spreads are tight
Corporate high-yield bond spreads appear tight relative to volatility and a likely rise in the default rate.
Neutral on commodities
After a volatile quarter, a shift from overweight to neutral for commodities.
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