Conventional wisdom dictates that everyone should save as much as they can, as early as they can, for as long as they can in order to live a dignified life in retirement.
Despite a downturn in May, the second quarter as a whole was a positive one for investment markets: global equities generally rose, credit spreads remained tight and implied equity volatility (as measured by the CBOE Volatility Index) was well below average. Interest rates remained extremely low both in the United States and abroad—particularly in Europe, where some $13 trillion of bonds are trading at negative yields.1 In addition to equities and bonds, currencies also experienced unusually subdued levels of volatility
We cannot predict what will happen next in economies or markets, but 2018 had the feel of a transitional year. Volatility, which in our view, had been muted for an unexpectedly long period of time, returned in force during the year—first in February and then again in the fourth quarter.
First Eagle’s Global Value team has adopted the value investment philosophy first developed by Benjamin Graham and later refined by Warren Buffett.
Over the last several years, the retirement landscape has markedly changed. Americans are living longer and need to plan accordingly. At the same time, with defined contribution plans replacing defined benefit plans both at corporations and, more recently, at public entities, individuals also need to shoulder greater responsibility for their own retirement saving.