Looming Fed Policy Shift Poses Challenge to Investors

The U.S. Federal Reserve’s probable policy shift at the upcoming Sept. 17-18 meeting to begin paring back the pace of its asset purchase program poses a challenge to investor allocation decisions. The Fed’s low-interest rate policy has achieved some success in boosting risk-taking among investors. Some measures of U.S. equities valuations, Tobin’s ‘Q’ for example, have moved back to fair value after recording severely undervalued readings during the Great Recession.

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