When Rebalancing, Don't Ignore Fixed Income, Says Clarfeld Financial's CIO

The video discusses the importance of portfolio rebalancing, especially towards the year-end, considering capital gain distributions and the shift from active to passive management. It highlights the divergences between US and foreign markets, with US markets showing positive returns and earnings beating estimates. The discussion includes market cycles, valuation trends, and the potential for a rebound. The video advises against expecting unsustainable double-digit returns and emphasizes the importance of diversification, including fixed income, in managing portfolio volatility.

What is a key consideration when rebalancing a portfolio towards the year-end?

• Focusing solely on active management

• Avoiding capital gain distributions

• Ignoring foreign markets

• Increasing exposure to US markets

What has been a consistent trend in US market earnings over the past five years?

• Earnings have consistently missed analysts' estimates

• Earnings have consistently beaten analysts' estimates

• Earnings have been unpredictable

• Earnings have remained stagnant

What is the current valuation trend of the S&P 500?

• At its lowest since 2016

• Fluctuating unpredictably

• Unchanged since 2016

• At its highest since 2016

Why is it important to include fixed income in a diversified portfolio?

• It is not important

• It guarantees high returns

• It reduces portfolio volatility

• It is the only profitable asset class

What is the current market sentiment regarding double-digit returns?

• They are irrelevant to portfolio performance

• They are expected to continue indefinitely

• They may not be sustainable

• They are guaranteed for the next decade