Although the market has not yet bottomed and investors should be ready for flat returns through 2023, stocks have had a significant relief bounce in November after the October inflation report showed prices dropping.
In the near term, investors should limit their exposure to equities and bonds, the bank stated in a letter on Monday. The reasons why investors would wish to invest more in cash and credit right now were broken down by a Goldman analyst. Due to probable rate increases and uncertain economic growth, both equities and fixed-income assets may see “additional headwinds,” and the investment bank anticipates the US dollar to peak in 2023. Bonds may provide a good diversification tool in the upcoming year because of their decreased correlation to stocks.
