Page 3 - ISQ - April 2022

INVESTMENT STRATEGY QUARTERLY

hike. From a sector perspective, we remain biased toward the moderate prices toward $95 per barrel by year end. Ultimately,
cyclical sectors (Energy, Financials, and Industrials), but have higher energy prices should accelerate the global development
dialled back Consumer Discretionary exposure as it tries to carry and adoption of alternative energy sources such as solar and
the weight of higher energy costs. wind.
European equities need somebody (help!) not just anybody (help!) Despite the recent volatility, we still believe the economy and
as the crisis could cause stagflation (rising inflation with tepid markets can be full steam ahead by year end. We’re hopeful
growth). The tragedy has stunted tourism, pushed fuel prices to for a peaceful resolution and rebuild for Ukraine so that the
nearly double the levels seen in the US, put key imports in the devastation ends. It would also validate the historical precedent
crosshairs, and caused the worst European refugee crisis since of geopolitical conflicts being short-lived events so long as they
World War II. Not to mention, much of Europe is still battling the do not coincide with a recession. In the meantime, we encourage
pandemic. As a result, we continue to favour US equities over the you to get by with a little help from your wealth manager all you
other developed international markets. Emerging markets have need is confidence in a comprehensive financial plan when these
also been adversely impacted by rising commodity prices and a difficult times arrive, so that emotionally driven decisions can be
resurgence in COVID cases, but compelling valuations may make avoided.
select regions, like Asia, an opportunity for long-term investors. Overall, we remain optimistic for the world, US, and financial

You say you want an energy revolution, but this recent crisis markets. As John Lennon so eloquently sang, “You may say I’m
has only revealed the deep global dependency on oil and gas. a dreamer, but I’m not the only one. I hope someday you’ll join us.
Some investors fear the events of the Beatles era might repeat And the world will live as one.”
themselves – hour-long petrol station queues and astronomical All the best.
prices. But the US is now much more energy independent,
and the International Energy Agency has ~1.5 billion barrels of
strategic reserves – enough to replace Russia’s export production
for over six months. Since production around the world has not
been reduced and there are no shortages, we believe we can
say goodbye, goodbye to the recent calls for a conflict-induced Lawrence V. Adam, III, CFA, CIMA®, CFP®
Chief Investment Officer, Private Client Group
price of $150+ per barrel. In addition to an eventual (hopeful)
resolution in Ukraine, increased OPEC and US production should

Investment Strategy Committee Members

Lawrence V. Adam, III, CFA, CIMA®, CFP® – Committee President, Joey Madere, CFA Senior Portfolio Analyst, Equity Portfolio & Technical Strategy
Chief Investment Officer, Private Client Group
Ed Mills Managing Director, Washington Policy Analyst, Equity Research
Scott J. Brown, PhD Chief Economist, Raymond James
Pavel Molchanov Managing Director, Energy Analyst, Equity Research
James C. Camp, CFA Managing Director, Strategic Income,
Eagle Asset Management*
Chief Investment Office
Doug Drabik Managing Director, Fixed Income Research
Anne B. Platt, AWMA®, AIF®, RICP® – Committee Chair, Vice President,
J. Michael Gibbs Managing Director, Equity Portfolio & Technical Strategy Investment Strategy
Nick Goetze Managing Director, Fixed Income Solutions Giampiero Fuentes, CFP® Investment Strategy Manager, Investment Strategy
Nicholas Lacy, CFA Chief Portfolio Strategist, Asset Management Services Matthew Ziyadeh Investment Strategy Analyst, Investment Strategy

*An affiliate of Raymond James & Associates, Inc., and Raymond James Financial Services, Inc.
Investments & Wealth Institute (The Institute) is the owner of the certification marks “CIMA” and “Certified Investment Management Analyst.” Use of CIMA and/or Certified Investment
TM
Management Analyst signifies that the user has successfully completed The Institute’s initial and ongoing credentialing requirements for investment management professionals.
3
Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, Certified Financial Planner™ and federally registered CFP (with flame logo) in the U.S., which it
awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.