ETF Wrap: Where BlackRock sees ‘tremendous’ market opportunities for ETF investors in 2023 after damage to stocks, bonds

by | Dec 1, 2022 | Stock Market

Hello! In this week’s ETF Wrap, BlackRock’s Gargi Chaudhuri, head of iShares investment strategy for the Americas, discusses ways for investors to play a world of higher rates and elevated inflation in 2023. Please send feedback and tips to christine.idzelis@marketwatch.com. You can also follow me on Twitter at @cidzelis and find me on LinkedIn.

As investors assess the damage inflicted on asset prices by rising interest rates in 2022, an environment of higher rates should favor value-style equities in 2023, while bonds offer “tremendous” opportunities for income, according to BlackRock’s Gargi Chaudhuri, head of iShares investment strategy for the Americas. “We probably have not seen the bottom in the equity market yet,” Chaudhuri said in a phone interview. “Historically, whenever you thought of buying the dip, you thought of buying tech.” So, the notion that value stocks may outperform next year is “a departure from a decade of growth leadership,” according to a note Wednesday from Chaudhuri that provides investors a guide to 2023. As investors consider the impact of the Federal Reserve’s rate hikes on the stock market, and potentially allocating more to equities, value stocks are an area that should fare relatively well, she said by phone. Investors might consider the iShares Russell 1000 Value ETF
IWD,
-0.01%
and iShares MSCI USA Value Factor ETF
VLUE,
-0.33%
as options, Chaudhuri suggested. …

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