With 2024 heading to a close, it’s safe to say that the year flew by for most folks. Before investors and traders get ready to celebrate the new year, it’s prudent to think ahead and position portfolios to match 2025 expectations. This is especially true given both the current state of the market and potential upcoming federal policy.
J.P. Morgan recently released a new look-ahead outlook for 2025. In the outlook, the J.P. Morgan team highlighted how resilient consumer spending continued to buoy GDP through much of 2024.
“Despite high borrowing costs, business investment has been buoyed by strong corporate balance sheets and fiscal support from legislation such as the CHIPS Act and the Inflation Reduction Act,” noted J.P. Morgan. “Tech companies, in particular, have accelerated investment amidst an AI-arms race, and lower rates could facilitate similar investments across other sectors. “
Even though GDP remains in a strong space, the outlook notes how the Trump administration’s upcoming economic policy could affect where inflation stands. In particular, J.P. Morgan asserts that the tariff on Chinese goods could very well lead to more inflation and higher interest rates.
That being said, J.P. Morgan’s outlook still shows the economy in a stable position moving into 2025. “Policy forecasts at this stage are still highly speculative, but they don’t seem to spell disaster for the economy or markets in the short run,” J.P Morgan adds.
With all of this information under consideration, which equity strategies should investors consider moving towards? One approach investors could try in 2025 is a lower-volatility quality strategy.
For Your Consideration: GQI
As a good example, take a closer look at the Natixis Gateway Quality Income ETF (GQI ). GQI blends an equity-focused quality portfolio with an options overlay to diversify returns.
A quality portfolio can be highly beneficial for investors who are unsure of where the markets will settle in 2025. Quality-screened companies can be in a good position to capitalize on positive periods of economic growth and resilience. Additionally, high-quality portfolios tend to feature companies with sustainable competitive advantages that are built to weather periods of potential market strife.
The robust advantages of a quality-screened portfolio are only bolstered through GQI’s options overlay. This options strategy can help investors increase their monthly income regardless of current interest rates. The flexibility of options trading can also help keep a fund safe during moments of economic risk.
Many investors and advisors are already contributing to GQI before the year ends. As of November 15, 2024, FactSet data shows that the fund has seen over $12 million in inflows over the last month.
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