Tag Archives: Joe Becker

Milliman FRM Market Commentary: May 2017

Stocks are seemingly indefatigable, marking their seventh consecutive month of positive returns. In this month’s commentary we address:

• Equity market volatility exhibits an inverse relationship with stock/bond correlation. This is a benefit to managed risk funds.
• As a result of ongoing low volatility, managed risk funds have generally implemented their respective maximum equity allocations for most of 2017.
• Market-based measures of financial risks are near precrisis lows. How does a managed risk approach fit in that context?

To learn more, read Joe Becker‘s full commentary at MRIC.com.

TIPS vs. dividends: Inflation deliberation

Treasury inflation-protected securities, or TIPS, are often considered the ideal risk-free investment in retirement. Their government backing virtually eliminates credit risk, and the consumer price index (CPI) adjustment on the principal ensures that its value will rise with inflation. Milliman consultant Joe Becker offers more perspective at MRIC.com.

Milliman FRM market commentary: March 2017

S&P 500 dividends have increased at more than two times the rate of inflation over the last 30 years.

The S&P 500 CAPE ratio sits above its pre-crisis peak. Year-over-year PCE, the Fed’s preferred measure of inflation, climbed above 2% for the first time since 2012. An ocean of excess reserves diminishes the Fed’s ability to respond to inflation. Risk management, like insurance, is only a benefit when implemented ahead of a risk event.

To learn more, read Joe Becker‘s full commentary at MRIC.com.

How did financial markets respond to Brexit?

Throughout the month of June leading up to the Brexit vote, the markets appeared to have trouble deciding which way the vote would go. Equity markets began to sell off during the second week of June as Brexit appeared to be increasingly likely. On June 14, as sentiment changed and the likelihood of Brexit seemed to be waning, equity markets started to climb back to early June levels. Markets were firmly higher on the day of the vote, exhibiting confidence that Britons would choose to stay in the European Union. As vote counts came in, currency and futures markets grew increasingly volatile with the rising prospect that Brexit would prevail. The next morning, equity markets opened sharply lower, displaying the characteristics of a classic gap event. Milliman consultants Adam Schenck,  Jeff Greco, and Joe Becker provide more perspective in this article.