Stocks could slide further as interest rates begin their ascent

The recent sell-off in the stock market may not be over as interest rates finally begin to climb back to normal levels, Jack Ablin, CIO of Cresset Wealth Advisors, told CNBC viewers on October 10, 2018. As Ablin explained, the stock and bond markets are in a constant tug-of-war for investors’ assets. For nearly a decade, the Federal Reserve has been helping to pull money toward stocks by keeping bond yields artificially low. But as rates begin to rise as the economy accelerates, bonds are starting to look more attractive, which is yanking money back toward fixed income. Ablin, however, does not believe this tug of war is over as he thinks the “fair value” for yields on 10-year Treasuries, which closed on Oct. 10 at 3.22%, is around 4.5%.

A fourth interest rate hike in December isn’t guaranteed

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Cresset is an independent, award-winning multi-family office and private investment firm with more than $45 billion in assets under management (as of 04/01/2024). Cresset serves the unique needs of entrepreneurs, CEO founders, wealth creators, executives, and partners, as well as high-net-worth and multi-generational families. Our goal is to deliver a new paradigm for wealth management, giving you time to pursue what matters to you most.

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From Chief Investment Officer, Jack Ablin.
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