(New York)

Wall Street analysts area all over the map about where stocks are headed next year. Some firms are bearish (Morgan Stanley), some are neutral, and some are bullish. Put Bank of America in the latter category, as the bank says that stocks are set to surge in the first couple months of 2020. Calling the year “front-loaded”, Bank of America analysts say that the S&P 500 should rise by 5.2% by March 3rd. Michael Hartnett from BAML says that the combination of easing trade worries, diminished Brexit fears, and loose monetary policy should combine to cause a “melt-up” in risk assets.

FINSUM: We like this call. All the fears for the winter seemed to have ebbed, and there will be a few months before election worries really kick in.

(New York)

Breaking away is one of the biggest moments of an advisor’s lives. So much can go wrong and so much can go right. One of the most daunting aspects of breaking away is losing the infrastructure of a large firm, especially the tech infrastructure. So much of the success of breaking away depends on giving your clients a great experience during the transition, so choosing the right infrastructure is crucial. In order to avoid making a mistake, it is crucial to hire a consultant who specializes in the area. They will be able to tailor the tech you should get to the unique needs of your clients and your firm.

FINSUM: This is a very good idea as one of the biggest headaches (and potential sources of nightmarish stories) is making poor tech choices. Checkout LibertyFi, a specialist consultant in the area.

(New York)

Some investors live and die by it, but all should pay attention. The stock-bond ratio is an old investing indicator that can tell you when one asset class may be ready to head higher, and right now it is sending a strong signal. Ned Davis Research says that the ratio tends to bottom before economic recoveries. Therefore, if we have truly hit the bottom of the current economic cycle, then the ratio (S&P 500 divided by the US long-term treasury bond index) should start improving. “Barring an escalation in the trade war, we should see a recovery in early 2020 based on historical lead times”, said Ned Davis Research.

FINSUM: This is a very handy way to think about, and keep track of, risk-on/risk-off.

(New York)

One thing about the wealth management landscape that has never made much sense is how JP Morgan is not early as big a player as one might expect given the overall strength of its brand. Morgan Stanley and Merrill Lynch hog all the AUM and attention, with JP Morgan and Goldman Sachs mostly on the outside looking in. Well, that may be about to change, as JP Morgan is now planning some big changes to its wealth management business. According to the WSJ “The bank is creating a unit that will combine its U.S. wealth-management operations for affluent clients and the Chase branch network’s financial-advisory business”.

FINSUM: This sounds like a plan to go after mass market wealth management like Morgan Stanley or the Thundering Herd. Could be a big play.

(New York)

Investors should take a look at big banks. Executives at top financial companies are excited about potential Q4 performance. Earnings estimates are moving higher based on more bullish guidance. Last year’s fourth quarter saw a dismal performance from big banks, so that sets up a very favorable comparison to this year. Morgan Stanley’s earnings may be up 41% according to analysts surveyed by Bloomberg.

FINSUM: It will probably be well-telegraphed, but big bank stocks still seem like they might see movement higher now and a pop on earnings releases.