Market & Topical Perspectives

Maintaining an Even Keel Through Volatile Conditions

Maintaining an Even Keel Through Volatile Conditions

Facing threats from multiple directions—geopolitical strife, persistent inflation and shifting central bank policy among them—financial markets staggered out of the gates in 2022.

Key Takeaways

  • There has been almost no place to hide thus far in 2022 as volatility spiked and markets sold off in the face of a multitude of threats.

  • With inflation at multi-decade highs, it remains to be seen whether policymakers can achieve a “soft landing” for the economy or if a recession is the more likely outcome.

  • First Eagle seeks to leverage the price dislocations that often accompany volatility to identify attractive entry points into businesses we view as resilient, including those we believe have the potential to mitigate the impacts of inflation on portfolio returns.

  • While current market dynamics can be trying, strategies that attempt to mitigate the impact of down markets while participating in their upside may provide a more favorable outcome for investors, encouraging them to stay invested and providing the opportunity to compound gains over the long term.