Lifescapes/Wells Fargo Advisors
Top Five Portfolio Ideas to Help You Prepare for 2024
By Saghir A. Aslam
Rawalpindi, Pakistan
(The following information is provided solely to educate the Muslim community about investing and financial planning. It is hoped that the Ummah will benefit from this effort through greater financial empowerment, enabling the community to live securely with dignity and fulfill their religious and moral obligations towards charitable activities.)
We believe that 2024 will mark an important pivot point for the global economy and capital markets, and our 2024 Outlook offers five ideas to help you prepare.
The market’s performance over the past two years has been uneven for investors. The good news is we expect brighter days ahead. But before they arrive, the clouds have been gathering, and we expect the global economic slowdown (including in the US) will persist as the calendar turns to 2024.
Given this outlook, how should you prepare for 2024? Below are top five portfolio ideas for your consideration:
1. Stay defensive but prepare for early-cycle recovery
We continue to prefer more defensive portfolio positioning heading into an economic slowdown. Our guidance favors fixed income over investments in global company stocks that track economic growth most closely. We also favor an overweight position in commodity investments, which tend to perform well in inflationary environments.
Rebalancing your portfolio can help you manage risk and may help returns over time. The first step is to harvest profits in holdings that have become expensive and appear at risk of losing value. Next, consider reinvesting the proceeds in sectors that represent long-term value.
Our tactical favorites are the Industrials, Materials, and Health Care sectors. These sectors appear reasonably priced and will help build out the US economy’s infrastructure. They also include investments in green energy projects and returning select manufacturing to the US.
2. Anticipate a pivot to riskier equity classes
We anticipate an economic slowdown will weigh on equity markets, allowing for a potential pivot away from our defensive positioning. As we move deeper into 2024, we foresee a shift from a narrower focus on higher-quality or defensive assets to a broader opportunity set that includes assets that typically outperform defensive assets while the economy is early in a rebound or recovery.
Let me repeat once again that we are always sharing the information about how we see it. However, I have always encouraged you to do your homework, to do your research, take your time, keep your goals in mind, what you want to achieve, and what time frame you need. These are the basic golden rules for healthy investing anytime please make sure to follow these golden rules. (To be continued)
(Saghir A. Aslam only explains strategies and formulas that he has been using. He is merely providing information, and no advice is given. Mr Aslam does not endorse or recommend any broker, brokerage firm, or any investment at all, nor does he suggest that anyone will earn a profit when or if they purchase stocks, bonds or any other investments. All stocks or investment vehicles mentioned are for illustrative purposes only. Mr Aslam is not an attorney, accountant, real estate broker, stockbroker, investment advisor, or certified financial planner. Mr Aslam does not have anything for sale. Saghir Aslam has dedicated himself to social welfare activities since 1965 and serves as the founding chairman of Saba Homes, honoring and empowering the orphans.)
