Walt Czaicki, CFA

Quality has become a popular buzzword in equity investing. But what does it really mean?

Equities have an important role to play in a diversified allocation today, to help hedge against inflation and to navigate a lower-growth environment.

In a world of structurally higher inflation and interest rates, there are good reasons for equity investors to consider active portfolios for equity allocations.

The central market themes for the year continue to be: inflation, central bank tightening, and expectations of lower economic growth. After a volatile period, where are markets headed from here? AB's Senior Investment Strategist, Walt Czaicki, reminds investors that investing is a marathon, not a sprint.

As US inflation expectations grow, many investors are concerned about the potential impact on stocks. Our research shows that US equities have delivered solid returns during periods of moderate inflation for more than seven decades.

Even if this US election has a bigger impact on markets than in the past, we would advise against building an investing strategy based on a potential political outcome for several reasons.

These are tricky days for the global economy. As growth downshifts and corporate earnings weaken, some investors are dusting off playbooks for late-cycle investing. That makes sense, but there are a few twists to today's market conditions that may require new responses.

US companies, lured by historically low interest rates, have taken on massive amounts of debt in recent years. As rates begin to rise, investors should beware of companies that might be vulnerable to increasing financing costs.