Summary Highlights

With Trump re-elected as President and the Republican Party regaining majority control of Congress, the market now anticipates that the two major themes of "tax cuts" and "tariffs" will once again influence the long-term trajectory of the U.S. economy and corporate profitability.

However, if investors overreact to these issues by halting investments or even redeeming holdings, they may miss out on other long-term opportunities.

Therefore, the current priority is to generate sustainable income opportunities through U.S. multi-asset strategies, in order to reinforce investment results.

Can U.S. Stocks Lead the Global Market Again in 2025?

According to the latest data from MSCI and FactSet as of November 11, the S&P 500 index, led by large-cap tech stocks this year, still holds a P/E ratio of 22.3— second only to India's 23.4 among major global markets.

Furthermore, the same data shows that the S&P 500's projected earnings per share (EPS) growth for 2025 is 14.5%, surpassing the 14.0% forecast from six months ago, and significantly ahead of indices in Asia Pacific (excluding Japan), Europe, and Japan.

Thus, even though investor sentiment may be turning cautious, improved earnings expectations have naturally driven up valuations, and U.S. stocks still stand a strong chance of leading global markets in 2025.

Avoid Over-Optimism: Multi-Asset Strategies Offer More Advantages Than Single Asset

Market performance may not always align with initial expectations. In the coming period, factors such as:

• Whether Trump's new policies can be smoothly implemented after the election
• Legislative preferences of Capitol Hill toward different industries
• The Federal Reserve's interest rate cut pace
• Geopolitical developments
• Changes in the U.S. economy itself

could all disrupt market expectations.

In this scenario, it's best for investors to adopt multi-asset strategies instead of single-asset positions, to diversify the impact of specific events on individual assets, and potentially create multiple sources of return. Especially in highly volatile and uncertain markets, the more diversified the income sources, the better a portfolio can maintain stability and growth.

Numbers Speak: Equity-Bond Allocation Enhances Investment Efficiency

According to Bloomberg, FactSet, and MSCI, from December 31, 1999, to March 31, 2024, a 60/40 allocation between U.S. equities and bonds, held for more than five years, mostly yielded positive returns, with an annualized return of 6.6%.

Although this is slightly lower than the 7.4% from an all-equity portfolio, its volatility was only 11.3%, significantly lower than the 19.1% for equities.

When factoring in risk, the risk-adjusted return for the 60/40 portfolio was 0.58, higher than the 0.39 for an all-equity portfolio—demonstrating that diversified allocation can improve investment efficiency.

Additionally, investing in U.S. multi-asset strategies allows different asset classes to hedge volatility and generate income under various market conditions.

For example:

• Yield on U.S. high-yield bonds: 7.3%
• Yield on investment-grade bonds: 4.7%
• REITs yield: 3.7%
• Infrastructure equities yield: 2.2%

These assets can help offset part of equity losses through yield or income during market downturns.

Use JPMorgan Funds to Navigate Post-Election Market Volatility!

JPMorgan U.S. Leading Income Multi-Asset Fund (This fund invests a significant portion in high-risk, non-investment grade bonds. Distribution may come from principal or equalization reserve.) allocates assets across "equities, bonds, and real asset equities" in a 4:4:2 ratio to enhance long-term investment returns amid changing market conditions.

• About 40% in "U.S. high-quality growth stocks" + covered calls
• About 40% in "U.S. corporate bonds," including both investment-grade and non-investment-grade
• About 20% in "REITs and infrastructure" real asset equities

By combining stock dividends, bond interest, and options premiums, the fund effectively withstands market turbulence and enhances resilience.

This fund also maintains a 60/40 equity-bond ratio, with around 20% of equity assets in real assets, aiming to offer investors diversified income sources and stable performance.