No items found.
No items found.
No items found.
No items found.

Wilshire Investment Strategy Update - First Quarter 2022

In this quarter’s Investment Strategy Update, we discuss the potential impact of inflation and tighter financial conditions on equities and fixed income, as investors balance the impact of higher interest rates against earnings growth and a relatively healthy global economy. As real rates continue to rise, more attractively valued segments of the U.S. equity market have materially outperformed, which informed our decision to remove our underweight to U.S. growth equities. Given the substantial rise in interest rates and slowing albeit healthy economic growth, we have also removed our underweight to duration risk and moderated our underweight to core fixed income in favor of more flexible/alternative mandates. We also recognize that sentiment is prone to overreaction, and investors should give some credence to the risk that markets might be overpricing the risk of inflation in the short-term. While we continue to view inflation as a risk in the near-term, we have removed our overweight to commodities, seeking to monetize positions as volatility works in our favor. We provide a summary of our positioning, rationale and supporting exhibits in the following sections.