The best way to describe the psychology of investors today is “poised for disappointment”. To find out what’s driving this feeling, I sat down with Caroline Miller, Managing Editor and Global Strategist at BCA Research, a global leader in independent investment research, based in Montreal. Caroline is one of the most qualified women I know: CFA designation, MBA from INSEAD, and Bachelor of Arts (History) from Harvard. Caroline joined BCA in 2012 after spending 20 years managing institutional global fixed income.

Here’s her take on the global markets, plus a bonus tip for business success:

What is your outlook for world markets in the next 12-18 months?

An inflection point?

“The global economy is at a critical juncture. If growth weakens from current levels, risk of recession rises. Our base scenario calls for a rebound in growth.”

It’s the economy…“The direction of world markets over the next 12-18 months hinges on the direction of economic growth. A recession will be negative for equity markets, but a recovery from the current slowdown will be particularly positive in the context of low inflation which will keep interest rates from rising too much. (Higher rates could choke off growth.)”

Superpower Superbowl…“The largest risk to the growth outlook is trade policy uncertainty because it makes firms reluctant to expand without visibility on the future terms of trade, particularly between the US and China. Fortunately, from a socio-political perspective, both the Americans and Chinese have economic incentives to pursue détente in negotiations, rather than escalating trade tensions. President Trump will not be re-elected if the US economy tips into recession, and President Xi faces his own domestic constraints in taking a hard line against the US. Both need their respective economies to grow, and both have the ability to pursue a policy that is more conducive to growth than recession: de-escalating trade tensions.”

Liquid Lunch…“The recent decline in interest rates constitutes a tailwind for growth to the extent that access to credit lubricates corporate investment and housing sector activity, two big engines of the economy. At present, low interest rates are stimulative for growth while making bonds an unattractive investment due to their low yields.”

Rollercoaster Ride…“Markets will be volatile over the next few months, awaiting confirmation of whether the economy is sputtering or on the verge of a rebound. However, over the next 12-18 months, barring a recession, stocks should outperform bonds and cash if we see signs of the global manufacturing sector stabilizing.”

What’s your advice to investors on keeping to their long-term plan?

“Try to tune out the daily ebb and flow of toxic headlines about political dysfunction and the calamity of the week. Short-termism is a by-product of social media and the short shelf-life of posted content. Most of the information that circulates is of little relevance to markets over the long term, so filter every story that constitutes a risk to markets as a relevant input to your investment process or longer-term plan.”

Who or what are the best sources of information for average investors?

“I have curated a long list of columnists, economists, market participants, professional investors whom I follow on Twitter: @csullym. I don’t do outgoing Tweets. I use Twitter as a news feed, which enhances rather than detracts from my productivity because I don’t follow celebrities or tabloid news, only economics and market professionals. Look at my feed for the list. Beyond that, however, to be financially literate, which should be any investor’s goal, follow these four sources: Financial Times,, The Economist, and The Wall Street Journal.”

You’ve achieved so much in the investment industry. What is your top tip for business success?

“I have always tried to remain versatile by remaining thoughtful about how I can repurpose my skillset in different environments. Adaptability has been a key success factor for me. I have been open to re-invention, which has allowed me to accept the non-linear nature of opportunity in life.”

Barbara Stewart, CFA is one of the world’s leading researchers on women and finance, focusing on real life financial behaviours and providing global insights into how smart women think and communicate. Barbara is an advocate for women, for diversity, and for financial education. In addition to her Rich Thinking® research, Barbara uses her proprietary research skills to work as an Executive Interviewer on a project basis for global financial institutions seeking to gain a deeper understanding of their key stakeholders, both women and men. Barbara is a frequent interview guest on TV, radio and print, both financial and general interest. She is a contributor to the CFA Institute’s Enterprising Investor website. For more information about Barbara’s research, please see