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Q4 Investment Outlook: How much downside is left?

  • The following quote refers to an old Wall Street saying: “The stock market stops panicking when central banks start to panic.” The Fed seems to be panicking in recent months, and we believe at their September meeting they made a mistake. Most of the forward-looking inflation indicators Astoria monitors are falling, and some quite rapidly. Hiking aggressively while the economy is slowing is rare. Typically, monetary policy becomes tighter when the economy is expanding.

  • Astoria feels that we may be close to the end of this tightening cycle. Will inflation stay structurally higher and for longer? Sure, but we believe we are 75% through this market downturn. When the Fed panics, usually that implies we’re close to the end of the market downturn.

  • Just remember, as markets correct, valuations improve, and forward expected returns become more attractive. It’s logical to be more bullish as the market goes lower, but many market pundits are preaching the opposite.

  • In conclusion, Astoria prefers dividend payers, value over growth, defensive quality stocks, and we are finally warming up to bonds after years of shunning the asset class. We are beginning to buy laddered US treasuries, IG credit, and munis—all short-dated paper. As always, we continue advocate including alternatives and to be diversified across factors.

Click here to read Astoria's Q4 Investment Outlook


Astoria Portfolio Advisors

Astoria Portfolio Advisors Disclosure: As of the time this research report was written, Astoria held positions in AAPL on behalf of its clients. Past performance is not indicative of future performance. Any third-party websites provided on are strictly for informational purposes and for convenience. These third-party websites are publicly available and do not belong to Astoria Portfolio Advisors LLC. We do not administer the content or control it. We cannot be held liable for the accuracy, time-sensitive nature, or viability of any information shown on these sites. The material in these links is not intended to be relied upon as a forecast or investment advice by Astoria Portfolio Advisors LLC and does not constitute a recommendation, offer, or solicitation for any security or investment strategy. The appearance of such third-party material on our website does not imply our endorsement of the third-party website. We are not responsible for your use of the linked site or its content. Once you leave Astoria Portfolio Advisors LLC's website, you will be subject to the terms of use and privacy policies of the third-party website. Refer here for more details.

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