Factor investing: Where are we now? Bobby Barnes

Fidelity head of Quantitative Index Solutions, Bobby Barnes, joins the show today to discuss the current market cycle. While the magnificent seven have driven a 20% year-to-date increase in the S&P 500, he cautions against overlooking other areas of the market. He highlights the Fed's intention to combat inflation through interest rate hikes, emphasizing the importance of understanding the direction rather than the absolute level of economic indicators like the ISM. Bobby also provides insights on the market's potential trajectory, suggesting reasons to be positive but also noting the importance of considering factors like average stock performance and consumer indicators. The conversation also touches on late-cycle positioning, the role of AI in shaping market dynamics, the market's vulnerability to exogenous shocks, the outlook for interest rate cuts, and considerations for asset allocations, particularly in fixed income. Overall, Bobby advises investors to closely monitor incoming data and position portfolios accordingly in light of the hikes still to be digested.

Recorded on December 1, 2023.

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