Quarterly Investment Review

April 11, 2019

Our first quarter overview of the global financial markets and our perspective on them.

The plunge in risk assets during the fourth quarter, and subsequent bounce back in the first quarter of this year, are a reminder to always expect the unexpected when it comes to investing. Kevin Barr, Head of our Investment Management Unit, provides an overview of the global financial markets and our perspective. 

Q1 2019

Transcript

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Hi,  I'm Kevin Barr, Head of SEI's Investment Management Unit.

Over the next few minutes I will provide an overview of the global financial markets and our perspective on them.  

Investor sentiment took a 180-degree turn with the start of the new year.

Stock markets rallied around the globe through most of the first quarter, reclaiming much of the fourth quarter’s losses.  

The S&P 500 Index posted a double-digit gain, and global equity markets, represented by the MSCI ACWI Index, moved nearly in lockstep. 

Last year we stated that growth in certain non-U.S. markets would likely outpace the U.S. moving forward.

A look at the country-level components of the MSCI ACWI Index highlights the results.

From the beginning of the fourth-quarter 2018 through the end of first-quarter 2019, U.S. stocks ended up in the middle of the pack with an overall decline of about 2%.

By contrast, Brazil, Indonesia, the Phillipines, Hungary and Hong Kong all saw returns in excess of 10%.  

Looking back at the past two quarters is interesting in several ways.

The sharp drop and rebound in equity prices highlights the unpredictable nature of market volatility.

While investors most often think about volatility in terms of stock market declines, volatility can also lead to significant gains.  

Likewise, the results in Brazil, Indonesia and the other top-performing countries highlight the potential benefits of diversification.  

Taken together, they serve as sound arguments for the time-tested strategies of diversification and long-term investing.  

The plunge in risk assets during the fourth quarter, and subsequent bounce back in the first quarter of this year, are a reminder to always expect the unexpected when it comes to investing.  

In a world where the best- and worst-performing asset classes tend to dominate the headlines, it can be easy to forget that diversification has been a prudent approach for meeting long-term investment goals.  

On behalf of everyone at SEI, thank you, as always for your trust and confidence.
 

Index Descriptions 

All indexes are quoted in gross performance unless otherwise indicated. 

The MSCI ACWI Index is a market-capitalization-weighted Index composed of over 2,000 companies, and is representative of the market structure of 48 developed and emerging-market countries in North and South America, Europe, Africa and the Pacific Rim. The index is calculated with net dividends reinvested in U.S. dollars. 

The S&P 500 Index is an unmanaged, market-capitalization weighted index that consists of the 500 largest publicly traded U.S. companies and is considered representative of the broad U.S. stock market.

Legal Note

Disclosures
There are risks involved with investing, including loss of principal.
International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors as well as increased volatility and lower trading volume. Diversification may not protect against market loss.

This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice and is intended for educational purposes only.

Index returns are for illustrative purposes only and do not represent actual fund performance. Index performance returns do not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and one cannot invest directly in an index. Past performance does not guarantee future results.

For those SEI Funds which employ the ‘manager of managers’ structure, SEI Investments Management Corporation (SIMC) has ultimate responsibility for the investment performance of the Funds due to its responsibility to oversee the sub-advisers and recommend their hiring, termination and replacement. To determine if the Funds are an appropriate investment for you, carefully consider the investment objectives, risk factors and charges and expenses before investing. This and other information can be found in the Funds’ summary and full prospectuses, which may be obtained by calling 1-800-DIAL-SEI. Read it carefully before investing.
SEI Investments Management Corporation (SIMC) is the adviser to the SEI funds, which are distributed by SEI Investments Distribution Co (SIDCO). SIMC and SIDCO are wholly owned subsidiaries of SEI Investments Company.

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