Investment Outlooks 2014

2014 Investment Themes

Read all themes


Read below for edited compilations of our investment teams’ perspectives on some of the major investment themes that could impact the markets in 2014.

Insights on the prospects for economic growth, corporate performance, and broad market trends.

Read more

After a year in which income-oriented investments were in demand, where might yield-oriented investors turn next?

Read more

Developed world stocks far outpaced emerging market equities in 2013. Where might growth come from in 2014?

Read more

We believe emerging market stocks in 2014 will be driven by three main factors: the Chinese economy, global monetary policy, and politics.

Read the outlook

Learn more about the equity and fixed income investment teams at Delaware Investments.
Liu-Er Chen

Liu-Er Chen, CFA

Senior Vice President,
Chief Investment Officer – Emerging Markets and Healthcare

(View bio)

International investments entail risks not ordinarily associated with U.S. investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations.

Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.

We intend to maintain our emphasis on bonds within the lower tier of the investment grade bond universe. We believe this segment of the marketplace provides better long-term value potential for diligent investors like us.

Read the outlook

Learn more about the equity and fixed income investment teams at Delaware Investments.
Joseph R. Baxter

Joseph R. Baxter

Senior Vice President,
Head of Municipal Bond Department,
Senior Portfolio Manager

(View bio)

Substantially all dividend income derived from tax-free funds is exempt from federal income tax. Some income may be subject to the federal alternative minimum tax (AMT) that applies to certain investors. Capital gains, if any, are taxable.

Funds that invest primarily in one state may be more susceptible to the economic, regulatory, and other factors of that state than funds that invest more broadly. 

Fixed income securities and bond funds can lose value, and investors can lose principal, as interest rates rise. They also may be affected by economic conditions that hinder an issuer’s ability to make interest and principal payments on its debt. 

The Fund may also be subject to prepayment risk, the risk that the principal of a fixed income security that is held by the Fund may be prepaid prior to maturity, potentially forcing the Fund to reinvest that money at a lower interest rate.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

The Barclays Municipal Bond Index measures the total return performance of the long-term, investment grade tax-exempt bond market.

Standard & Poor's credit rating agency. Bonds rated below AAA, including A, are more susceptible to the adverse effects of changes in circumstances and economic conditions than those in higher-rated categories, but the obligor's capacity to meet its financial commitment on the obligation is still strong. Bonds rated BBB exhibit adequate protection parameters, although adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitments. Bonds rated BB, B, and CCC are regarded as having significant speculative characteristics with BB indicating the least degree of speculation.

Our research-driven approach means that we will focus on protecting our portfolios, resisting the urge to overreach for yield or otherwise put our portfolios in jeopardy.

Read the outlook

Learn more about the equity and fixed income investment teams at Delaware Investments.
Joseph R. Baxter

Paul A. Matlack, CFA

Senior Vice President,
Senior Portfolio Manager,
Fixed Income Strategist

(View bio)

Fixed income securities and bond funds can lose value, and investors can lose principal, as interest rates rise. They also may be affected by economic conditions that hinder an issuer’s ability to make interest and principal payments on its debt.

Securities in the lowest of the rating categories considered to be investment grade (that is, Baa or BBB) have some speculative characteristics.

High yielding, noninvestment grade bonds (junk bonds) involve higher risk than investment grade bonds.

The Fund may also be subject to prepayment risk, the risk that the principal of a fixed income security that is held by the Fund may be prepaid prior to maturity, potentially forcing the Fund to reinvest that money at a lower interest rate.

We believe cyclical volatility will always create opportunities for those who understand and are prepared for it.

Read the outlook

Learn more about the equity and fixed income investment teams at Delaware Investments.
Edward A. Gray

Edward A. "Ned" Gray, CFA

Senior Vice President,
Chief Investment Officer – Global and International Value Equity

(View bio)

International investments entail risks not ordinarily associated with U.S. investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations.

Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.

We are cautiously optimistic about the prospects for equities, especially those of higher-quality companies that are trading well below their long-term average valuation multiples.

Read the outlook

Learn more about the equity and fixed income investment teams at Delaware Investments.
D. Tysen Nutt Jr.

D. Tysen Nutt Jr.

Senior Vice President,
Senior Portfolio Manager,
Team Leader

(View bio)

Carl D. Rice

Carl D. Rice, CFA

Vice President,
Senior Investment Specialist

(View bio)

 

Value investing focuses on buying stocks that are trading at bargain prices based on fundamental analysis, then holding them until they become fully valued. Typically, value investors select securities with lower-than-average price-to-book or price-to-earnings ratios and/or high dividend yields.

Diversification may not protect against market risk.

The P/E ratio is a valuation ratio of a company's current share price compared to its earnings per share.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

The S&P/Case-Shiller 20-City Home Price Index measures the residential housing market, tracking changes in the value of single-family housing in 20 metropolitan regions across the United States.

The S&P 500 Index measures the performance of 500 mostly large-cap stocks weighted by market value, and is often used to represent performance of the U.S. stock market.

The Russell 1000 Value Index measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.

We believe income-seeking investors should place less emphasis on the highest current yield and more emphasis on the potential for growth in yield.

Read the outlook

Learn more about the equity and fixed income investment teams at Delaware Investments.
Babak Zenouzi

Babak "Bob" Zenouzi

Senior Vice President,
Chief Investment Officer – Real Estate Securities and Income Solutions (RESIS)

(View bio)

Narrowly focused investments may exhibit higher volatility than investments in multiple industry sectors.

REIT investments are subject to many of the risks associated with direct real estate ownership, including changes in economic conditions, credit risk, and interest rate fluctuations. A REIT fund's tax status as a regulated investment company could be jeopardized if it holds real estate directly, as a result of defaults, or receives rental income from real estate holdings.

"Nondiversified" Funds may allocate more of their net assets to investments in single securities than "diversified" Funds. Resulting adverse effects may subject these Funds to greater risks and volatility.

International investments entail risks not ordinarily associated with U.S. investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations.

Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

The S&P 500 Index measures the performance of 500 mostly large-cap stocks weighted by market value, and is often used to represent performance of the U.S. stock market.

The views expressed in each outlook represent the Manager's assessment of the market environment as of December 2013, and should not be considered a recommendation to buy, hold, or sell any security, and should not be relied on as research or investment advice. Views are subject to change without notice and may not reflect the Manager's current views. The views expressed in each outlook are general in nature.

IMPORTANT RISK CONSIDERATIONS

Investing involves risk, including the possible loss of principal.

Certain statements made here are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA). A forward-looking statement is a statement that is not a historical fact and, without limitation, includes any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like: “believe,” “anticipate,” “expect,” “estimate,” “project,” “will,” “shall,” and other words or phrases with similar meaning in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, trends in our businesses, prospective services or products, future performance or financial results, and the outcome of contingencies, such as legal proceedings. The protection afforded by the safe harbor for forward-looking statements provided by the PSLRA is claimed hereunder.

Due to the uncertainty inherent in forward-looking statements, actual results or economic conditions may differ materially from those anticipated in the forward-looking statements. Investors should not place undue reliance on forward-looking statements as a prediction of actual results. In addition, we disclaim any obligation to update any forward-looking statements to reflect events or circumstances that occur after the date of this document.