### The Global Market Index (GMI) Long-Term Performance Forecast
#### Declining Trend Continues
– The long-term performance forecast for the Global Market Index (GMI) saw a decrease in September.
– This marks the third consecutive month of decline for GMI, an unmanaged benchmark that holds all major asset classes (except cash) based on market weights via a set of ETF proxies.
#### Revised Estimate
– GMI’s long-term estimate dropped to an annualized 6.7% performance, down from 6.8% previously, based on the average of three models.
#### US Equities Outlook
– US equities remain a downside outlier for expected return compared to historical data and other asset classes in GMI.
– The forecast for American shares is significantly lower than its trailing 10-year performance, indicating softer results in the years ahead.
#### Diversification Advantage
– Other major asset classes in GMI are showing return forecasts above their trailing 10-year records.
– This suggests that a globally diversified portfolio may be more attractive moving forward.
#### Reliability of Projections
– While forecasts may vary in accuracy, GMI’s projections are expected to be more reliable compared to individual market estimates.
– Aggregating forecasts into the GMI estimate can help reduce errors over time.
#### Using Estimates as Baseline
– Investors can use the estimates as a baseline for refining their expectations and adjusting their investment strategies accordingly.
#### Historical Performance Comparison
– GMI’s realized total return over the past ten years stands at 7.6%, which is average compared to recent history.
– The chart below compares GMI’s performance with US stocks and bonds over the same period.
### Conclusion
– The declining long-term performance forecast for the Global Market Index emphasizes the importance of investors adapting their strategies to optimize returns and manage risk effectively.
### Analysis
The Global Market Index (GMI) is a key benchmark for investors, reflecting the performance outlook for various asset classes globally. The recent decline in GMI’s long-term forecast signals a shift in the investment landscape, highlighting the need for investors to reassess their portfolios and diversify strategically. By understanding the forecasts for different markets and using them as a guide, investors can make informed decisions to navigate changing market conditions and achieve their financial goals. This analysis underscores the significance of staying informed, adapting to market trends, and seeking opportunities for long-term growth and stability in an ever-evolving investment environment.