Fiscal Year-End and Mid-Year 2021 Market and Investment Review

July 7, 2021 |
1 minute read
|

The new fiscal year beginning July 1st will mark Commonfund’s fifty-year anniversary – and what a memorable year it has been. As we write this letter, we are hopeful that the new year will bring positive developments and that progress towards getting “back to normal” will continue both in the U.S. and around the world. Rather than rehashing all the challenges of the past year, this letter will look forward as we anticipate where the markets will go coming out of what was decidedly an unusual year.

Things are Looking (Mostly) Up

As we close out the fiscal year ending June 30, the markets overall appear healthy. Equity indices, domestic and global, are near all-time highs, corporate and high-yield spreads are approaching historic lows, and after a bout of indigestion in the first quarter of 2021, the risk-free interest rate markets have held steady. Corporate earnings are accelerating and will likely exceed the lofty levels of the first quarter at mid-year. While fiscal policy remains expansionary, as repairing America's infrastructure remains a goal of both parties, ideological disagreements remain in terms of content, size, and funding. Domestic economic data for the first six months of 2021 has maintained a positive trend, confirmed by first quarter U.S. GDP at 6.4 percent but, looking to the future, the economic “lift” may get heavier as the task of recovery transitions to generating consistent future growth while avoiding the negative short-term consequences of higher debt, deficits, and inflation.

Download the full letter to finish reading.

Stay connected with the Insights Blog

Popular Blog Posts


Investment Strategy | Insights Blog

What is an OCIO?

Outsourced investment management, once primarily a solution for small institutions with limited resources, is now used by a broad range of long-term investors. When properly implemented, outsourcing...
Investment Strategy | Insights Blog

How to Measure Private Equity Investments

Private capital investors use a particular set of quantitative and qualitative measures to assess performance. While the standard benchmarks used for marketable securities are sometimes applied to...
Governance And Policy | Insights Blog

Five Key Points of the Investment Policy Statement

The central document guiding the management of a nonprofit institution’s endowment—essentially, the strategic plan of the investment committee—is the investment policy statement (IPS). The IPS should...

Disclaimer

Information, opinions, or commentary concerning the financial markets, economic conditions, or other topical subject matter are prepared, written, or created prior to printing and do not reflect current, up-to-date, market or economic conditions. Commonfund disclaims any responsibility to update such information, opinions, or commentary. To the extent views presented forecast market activity, they may be based on many factors in addition to those explicitly stated in this material. Forecasts of experts inevitably differ. Views attributed to third parties are presented to demonstrate the existence of points of view, not as a basis for recommendations or as investment advice. Managers who may or may not subscribe to the views expressed in this material make investment decisions for funds maintained by Commonfund or its affiliates. The views presented in this material may not be relied upon as an indication of trading intent on behalf of any Commonfund fund, or of any Commonfund manager. Market and investment views of third parties presented in this material do not necessarily reflect the views of Commonfund and Commonfund disclaims any responsibility to present its views on the subjects covered in statements by third parties. Statements concerning Commonfund’s views of possible future outcomes in any investment asset class or market, or of possible future economic developments, are not intended, and should not be construed, as forecasts or predictions of the future investment performance of any Commonfund fund. Such statements are also not intended as recommendations by any Commonfund entity or employee to the recipient of the presentation. It is Commonfund’s policy that investment recommendations to its clients must be based on the investment objectives and risk tolerances of each individual client. All market outlook and similar statements are based upon information reasonably available as of the date of this presentation (unless an earlier date is stated with regard to particular information), and reasonably believed to be accurate by Commonfund. Commonfund disclaims any responsibility to provide the recipient of this presentation with updated or corrected information. Past performance is not indicative of future results. For more information please refer to Important Disclosures.