Among the firm’s recommendations: Investors should focus on high quality securities and fixed income products that can respond to a changing interest rate environment. In addition, Arrow says investors should look outside the U.S. for opportunities and consider alternative strategies for defensive positioning.
“We are now in the middle of one of the longest economic expansions in the country’s history, and with the new tax cuts in place and the potential for substantial infrastructure spending on the horizon, we expect the growth to continue,” said Joe Barrato, CEO and Director of Investment Strategies at Arrow Funds. “However, given where we are in the cycle, it’s important for advisors to invest strategically, keeping in mind that markets can go down as well as up.”
Key points in Arrow’s 2018 Market Outlook include:
- Investors should consider a more prudent approach in 2018, incorporating alternative investments that have the potential to enhance returns while hedging risk;
- With the Fed in the early stages of a new tightening cycle, consider funds that can respond to a changing interest rate environment, including commodities and managed futures;
- Look abroad for opportunities in both equities and income-generating investments;
- When in doubt, look at what some of the biggest endowments are doing. Yale, for example, has moved to a diversified, equity-oriented allocation that has been delivering strong results.
The Arrow family of funds includes the multi-factor Arrow QVM Equity Factor ETF, (NYSE:QVM); fixed income products like the Arrow Dynamic Income Fund, (NASDAQ:ASFNX) and the ultrashort-term bond ETF the Arrow Reserve Capital Management ETF (BATS:ARCM); diversified multi-asset funds like the Arrow Dow Jones Global Yield ETF (NYSE:GYLD); alternative investment strategies like Arrow Managed Futures Strategy Fund (NASDAQ:MFTNX); a suite of offerings built on the industry-leading technical analysis of Dorsey Wright & Associates; and its endowment-like Arrow DWA Balanced Fund (NASDAQ:DWANX) and its global macro strategy Arrow DWA Tactical ETF (NASDAQ:DWAT).
Most recently, Arrow launched two international equity ETFs: the Arrow Dogs of the World ETF (NYSE:DOGS), which finds value among the worst performing international securities where a mean reversion is expected; and the Arrow DWA Country Rotation ETF (NASDAQ:DWCR), which offers a systematic price momentum strategy.
“DOGS and DWCR are our ‘yin and yang’ when it comes to approaching the international equity markets and were a natural extension of our fund lineup,” continued Barrato. “When we look at the 2018 market environment, we see a lot of opportunity for investors looking to add tactical and adaptive strategies into the mix, but it’s important that investors consider correlations to achieve true diversification. That is a major theme of our outlook piece this year, which we’re very pleased to be sharing with investors and advisors.”
About Arrow: Arrow Funds, including the exchange traded product line ArrowShares, is a company that offers targeted portfolio solutions for ever-changing markets. The company’s vision is to be the leading provider of alternative and tactical investment solutions with a focus on education, research and client service as the cornerstones. To learn more, visit www.ArrowFunds.com.
Shares of exchange traded products are bought and sold at market price, not NAV, and are not individually redeemed from the fund. Buying and selling shares generally results in brokerage commissions which will reduce returns. The market price may be higher (premium) or lower (discount) than the Net Asset Value (NAV).
Before investing, please read the prospectus and shareholder reports to learn about the investment strategy and potential risks. Investing involves risks, including the potential for loss of principal. An investor should consider the fund’s investment objective, charges, expenses and risks carefully before investing. This and other information is contained in the prospectus, which can be obtained by calling 1-877-277-6933. Content reviewed by an affiliate, Archer Distributors, LLC (member FINRA). AD-020618
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