‘The fear is gone’

NEW YORK – The biggest risk for investors since the end of the 2008 financial crisis has been, well, ducking risk. Not anymore, say analysts who think the easy money has been made.

Over the last nine years, investors who limited risk in their portfolios, whether stocks, corporate bonds or emerging market assets, have been punished for their squeamishness.

Since risky markets like equities hit bottom in early 2009, the US benchmark S&P 500 stock index .SPX has tripled, delivering an annualised total return of 19 per cent, roughly 15 percentage points a year above what the Bloomberg Barclays US Aggregate bond index .BCUSA delivered.

That bull run, in US stocks in particular, against a backdrop of steady economic growth, is leaving even skeptical fund managers and analysts reluctant to predict a near-term pullback, according to participants at the Reuters Global Investment 2018 Outlook Summit in New York this week.

Still, even as they advise investors to stay in the market, they also see the need to be wary of what they see as widespread complacency about valuations and be prepared for a bumpy ride in the year ahead.

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