ECMG Newsletter | September 2023
Envision Capital Management Group
ECMG is a nonprofit student-run investment fund at the Kelley School of Business.
Hello! And welcome to?Envision Capital Management Group’s monthly newsletter,?where we cover everything ECMG, including our latest updates, member and leadership spotlights, macro/market recaps, and more!
Market Recap | September 2023
Inflation and Monetary Policy: The September federal funds rate remains unchanged at a range of 5.25% to 5.5%. There are predictions that a rate hike will occur later this year. The Fed is continuing high rates until inflation lowers, revealing the uncertainty of the Fed. The Fed hopes to reach its 2% inflation goal.?
The Fed is pursuing a “higher-for-longer" interest rate, shown in the Bloomberg dot plot of Fed members’ projections of the federal funds rate.?
Labor Market: According to the U.S. Bureau of Labor Statistics, the unemployment rate was unchanged at 3.8% and the nonfarm payroll employment increased by 336,000 in September. Without any major increase in unemployment, the number of job openings and salary growth are falling at a steady pace. For all employees, average hourly earnings on private nonfarm payrolls rose by 7 cents. Though it may seem like the labor market wasn't as prosperous as the last 2 years, it certainly exceeds the market of 2019 by far.
Housing Market: ?The 30-year fixed mortgage rate has surged to its highest point this year, settling at 7.31% in September 2023. Additionally, the housing market has witnessed some significant decreases, with a 20% decline in net listings and a 12.4% decrease in properties under contract compared to September 2022. Furthermore, the Nahb Housing Market Index has dipped by 5 points to a reading of 45 for the month of September. However, on a brighter note, the sale-to-list-price ratio remains robust at 99.0%, significantly above the lowest value recorded in January 2023, indicating resilience and stability in the market.
International News: The UK's annual inflation rate fell for the third consecutive month in August, surprising economists, with consumer prices 6.7% higher than the previous year. Core inflation dropped to 6.2%, and services inflation eased to 6.8%, its lowest level since March. This unexpected decline in inflation raises uncertainty about the Bank of England's planned interest rate hike, causing market fluctuations. Despite this, the UK's inflation rate remains higher than that of its peers, while Europe grapples with rising prices due to the aftermath of the Ukraine war.
Leadership Spotlights
Sanjana Paramesh , our new Director of Macro Research, joined ECMG in the spring semester of her freshman year as a part of the macro research team, while also simultaneously being involved with the derivatives fund. As Director, Sanjana hopes to restructure the division by providing guidance to new analysts through a plethora of resources and educational onboardings. Additionally, she envisions a closer collaboration with teams part of the long equity fund, as a way to provide key macro information and research tailored towards specific industries to help supplement investment theses and improve pitches.
Our new Delta Portfolio Manager, Brian Garten , is a sophomore from Connecticut pursuing a major in finance while also considering a minor in film. Brian joined ECMG in the fall of his freshman year, to develop connections with people who shared the same interests in investment management and the financial markets. He looks forward to a semester of high-quality pitches and guiding new analysts through mentorship and many deliverables.
Member Spotlights
领英推荐
Fall 2023 Recruitment
This past month, we wrapped up another successful semester of recruiting, welcoming in new analysts across all 3 sectors. We had an amazing time engaging and networking with several interested students across our different events at the IU Fall Involvement Fair, Kelley Carnival, and our callout meeting!
We are excited to get to know our new analysts further this semester and see them grow as they undergo educational onboarding, get involved with mentorship groups, write new reports, and deliver pitches at investment board presentations. We look forward to expanding our member size again in the Spring!
Thank you for reading this edition of ECMG's monthly newsletter, and be sure to catch our next one for more updates!
??? This newsletter was written and designed by Neena Mehta, Samuel Jha, Raj Taylor, Grisha Kanphade, Keshav Kamat, Halsey Klika, and Cam Fagan.