The near and medium-term market outlook is critical in both the asset allocation decisions as well as the fund selection decisions. For example, if you anticipate that we are going into a bear market, you would want to invest in more conservative funds like long-term bond funds or value stock funds. On the other hand, if you are anticipating that the market has bottomed out, you would not want to invest in long-term bond funds because they would lose their value. Instead you would want to invest in growth stock funds.
To assess the market’s near and medium-term outlook, the MutualFundAlliance.com has a series of economic forecasting models and compares the models’ output relatively to other major financial forecasts, like the National Association of Business Economists (NABE) and the Federal Reserve Board (Fed).
In Chapter 2, we describe various statistical indicators that are useful in assessing the state of the overall economy and markets. In the table below, we list these indices.
Stock Market Indices
The MutualFundAlliance.com tracks all of these statistics and updates its market outlook weekly and posts it on the front page of MutualFundAlliance.com.