We integrate the results of our economic work with our valuation analysis to form a view of which areas in the markets are more or less favorable for investment at a particular point in time. Market phases of relative over and under valuation can continue for long periods, often reversing only after a change in the macro environment. In this context, we use our valuation work to identify opportunities to enhance returns and our economic trend work to identify the potential catalyst for change. We exploit these insights to take advantage of positive changes not reflected in prices (i.e., opportunities) and to reduce exposure to negative changes (i.e., risks).

Based on the relative attractiveness of the various asset classes, we establish an intermediate-term asset allocation for each client's portfolio, which will fall within the guideline ranges defined in the client's Investment Policy Statement.