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A Santa Claus rally appears to be materializing and driving market gains (^DJI, ^IXIC, ^GSPC) Tuesday as 2024 draws to a close. F/m Investments President and chief investment officer Alex Morris joins Market Domination to discuss his market outlook for 2025.
Morris emphasizes that inflation remains the market's central focus, driven by both bond dynamics (^TYX, ^TNX, ^FVX) and pro-inflationary policies. With investors seeking portfolio protection, he notes that traditional safeguards have disappointed: "So now folks are left wondering where are they gonna go?"
To navigate current market uncertainty, Morris advocates for Treasury Inflation-Protected Securities (TIPS), specifically short-term options. He explains that investors in mid or long-term TIPS found that "duration cannibalized all of their actual inflation protection." Additionally, he recommends cash bonds and shorter-term investment-grade bonds, noting that "folks have done pretty well there."
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This post was written by Angel Smith