”Every year, we review the data that drive capital markets—current valuation measures, historical risk premia, and economic growth and inflation prospects—to provide the foundation for our forecasts. We update the models that we use and review their continued appropriateness. Crucially, our models are based on first-principle economic relationships and reflect seasoned practitioner judgment. We continue to include as part of every capital market forecast a measure of the expected volatility of each asset class, informed by both longterm and short-term volatility dynamics.”
Morten W. Langer
