Lowell on CNBC: Volatile Markets Call for Actively Managed Portfolios
Chief Investment Officer Jim Lowell joined CNBC to share his perspective on recent interest-rate cuts and prudent investor strategies built to withstand market volatilityA measure of how large the changes in an asset’s price are. The more volatile an asset, the more likely that its price will experience sharp rises and steep drops over time. The more volatile an asset is, the riskier it is to invest in.. Jim emphasized his belief that the U.S. economy’s strong fundamentals did not validate recent rate reductions. Jim remarked, “Our Fed may be tipping a little more towards trying to be proactive rather than reactive—I think that’s dangerous: They need to remain data-dependent.” Jim further noted that the current investing environment reaffirms the need for investors to remain well-diversified with an actively managed portfolio that includes short-term bondsA financial instrument representing an IOU from the borrower to the lender. Bond issuers promise to pay bond holders a given amount of interest for a pre-determined amount of time until the loan is repaid in full (otherwise known as the maturity date). Bonds can have a fixed or floating interest rate. Fixed-rate bonds pay out a pre-determined amount of interest each year, while floating-rate bonds can pay higher or lower interest each year depending on prevailing market interest rates. and cash.