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CLA OUTLOOK

Key Insights for Sound Financial Strategies

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MARCH 30 WEEKLY INSIGHTS
Private credit redemptions on the rise, asset class remains stable
  • Redemption activity across private credit interval funds increased meaningfully in early 2026, testing liquidity management and investor confidence rather than underlying credit quality.
  • Managers are meeting elevated redemption demand within the interval fund structural framework, exercising discretion to increase quarterly repurchases.
  • Interval fund redemption gates help protect remaining investors by preventing forced asset sales, preserving portfolio integrity, and helping liquidity pressures to be managed equitably rather than to the detriment of long-term shareholders.
  • Private credit should represent 3 – 8% of a diversified total return portfolio. For allocations above 5%, consider using a combination of both corporate lending and real estate-backed private credit.
Bond volatility increases to incorporate global uncertainty, but yields still in forecasted range
  • Bond market volatility has risen meaningfully year-to-date, with the ICE BofAML MOVE Index increasing from the high 50s back toward 100. 
  • This follows a sustained decline in volatility late last year and into early 2026, after the MOVE Index spent much of 2025 elevated above 100. 
  • As the yield curve has shifted, the 1–5-year segment has experienced the largest move, creating a relative opportunity — particularly when compared with cash. 
  • Entering 2026, our CLA Outlook identified this portion of the curve as near the lower end of our forecasted range, and the recent move appears consistent with a normalization rather than a dislocation. (Source: ICE BofAML)
Prediction markets offer real-time window into market expectations, especially around oil
  • Prediction markets function as a real time aggregation of market expectations, translating collective beliefs about economic, political, and financial outcomes into continuously updated probability pricing.
  • This can complement traditional research, offering an alternative — particularly around binary or event driven outcomes where consensus shifts quickly. 
  • These markets reflect how geopolitical risk is being priced in real time, with contracts tied to crude price levels — often moving ahead of or alongside oil market volatility.
  • Looking to June, prediction markets estimate oil futures may settle above $84 per barrel at a 59% probability (this most likely outcome), with a settle between $77 – $84 pricing at a 13% probability. (Source: Polymarket Analytics)

Develop strong financial strategies

Tune in to the CLA Outlook for 2026 as we discuss timely topics around policy, the economy, and market performance.
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Strategic Opportunities

The Big Picture for 2026

The CLA Outlook signals a turning point: stabilized inflation, growth above trend, and easing interest rates. Explore the key forces influencing portfolios in the year ahead.

  • Economic outlook

    Growth is back on the horizon after three years of higher interest rates and restrictive Federal Reserve policies, with AI helping to transform industries.

  • Fiscal policy

    The rising U.S. deficit remains a key concern as government spending continues to outpace revenues — watch for this to be a focal point heading into midterm elections.

  • Fixed income outlook

    Lower interest rates should be a tailwind to bonds in 2026, though consider credit quality and duration when building high-quality income portfolios.

  • Equity outlook

    Despite elevated stock valuations, led by tech-dominant Magnificent-7 stocks, equities remain compelling because of strong earnings growth and a robust economic backdrop.

  • Alternatives outlook

    Lower interest rates favor private equity and private real estate, while private credit can warrant caution. Manager selection and due diligence remain critical.

  • We can help

    No matter your financial position, incorporating sound tax and wealth advisory could help you achieve more.

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