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3. Episode 6 : What to think about as we spring into March

Episode 6 : What to think about as we spring into MarchVideo

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Description: What might move markets this month? See what we're thinking.

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Length (seconds): 652

Transcript: <h2>Note:</h2> <p>Intense electronic music plays.</p> <p>Legal disclosures appear.</p> <h2>On screen:</h2> <p>INVESTMENT AND INSURANCE PRODUCTS ARE:</p> <p>NOT FDIC INSURED</p> <p>NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY</p> <p>NOT A DEPOSIT OR OTHER OBLIGATION OF, OR GUARANTEED BY, JPMORGAN CHASE BANK, N.A. OR ANY OF ITS AFFILIATES</p> <p>SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED</p> <p>This video is for informational purposes only. Opinions expressed herein are those of the speakers and may differ from those of other J.P. Morgan employees and affiliates. Neither J.P. Morgan nor any of its affiliates can represent that the statements of opinion expressed will materialize. This material should not be regarded as research or as a J.P. Morgan Research Report. Nothing in this material shall be considered a solicitation to buy or an offer to sell securities, other investments or services to any person in any jurisdiction where such an offer, solicitation, purchase or sale would be unlawful under the laws of such jurisdiction. Any mention of an individual security, investment or strategy is provided for informational purposes only and should not be construed as a recommendation. Outlooks and past performance are not guarantees of future results. Please read additional important Information at the end of the video.</p> <h2>On screen:</h2> <p>J.P.Morgan logo.</p> <h2>On screen:</h2> <p>What's Moving Markets?</p> <p>Three ideas…Three guests…</p> <p>What's The Move? By J.P. Morgan.</p> <h2>On screen:</h2> <p>In a spacious white room, a stage-crew member adjusts camera lights. At the same time, a man with light brown hair, blue eyes, and a white shirt, Ted Dimig, speaks to the viewer.</p> <h2>On screen:</h2> <p>Ted Dimig, Head of Investments, You Invest by J.P. Morgan.</p> <h2>Ted:</h2> <p>Welcome back to What's the Move? By J.P. Morgan. This is the series where three guests discuss what they think might move markets the most over the next month. And I’m your host, Ted Dimig. People say March comes in like a lion and goes out like a lamb. I have no idea who these people are. But when it comes to markets, the S&amp;P 500 has had negative returns 70% of the time during the month of March over the last 20 years. Will this year be a bit different? Will markets be fierce or a little more tame? Let's see what our three friends from J.P. Morgan think.</p> <h2>On screen:</h2> <p>Behind the scenes, Ted's three guests (Nelle, a woman with long blonde hair; Patrick, a man with short dark hair; and Stephen, a man with a short beard and light eyes) talk among themselves before the interview…</p> <h2>Nelle:</h2> <p>All right. Sorry. Let's start over again.</p> <h2>Patrick:</h2> <p>Go again?</p> <h2>On screen:</h2> <p>A Director's clapboard snaps shut with a pop. Close-up of Patrick.</p> <h2>On screen:</h2> <p>Patrick Lenihan.</p> <h2>Patrick:</h2> <p>So today, I'm here to talk about my investment idea: 5G technology.</p> <h2>On screen:</h2> <p>Close-up of Nelle.</p> <h2>On screen:</h2> <p>Nelle Miller.</p> <h2>Nelle:</h2> <p>I think I'm going to talk about what I consume every day and how that works into investments.</p> <h2>On screen:</h2> <p>Close-up of Stephen.</p> <h2>On screen:</h2> <p>Stephen Parker.</p> <h2>Stephen:</h2> <p>To me, I think the move for March is going global.</p> <h2>Patrick:</h2> <p>Let's do it.</p> <h2>Nelle:</h2> <p>OK.</p> <h2>On screen:</h2> <p>Patrick, Nelle, and Stephen walk into the white room and sit down with Ted around a glass coffee table. Ted speaks while stretching his arms forward dramatically.</p> <h2>Ted:</h2> <p>Beware the Ides of March. And beware the March episode of What's the Move? This's going to be a good one. I've got three of my closest friends and colleagues joining me to tell me what they think is going to move markets the most in the month of March. Patrick, you're up first.</p> <h2>On screen:</h2> <p>Patrick Lenihan, Portfolio Manager, J.P. Morgan Asset Management.</p> <h2>Patrick:</h2> <p>My high conviction idea for the month of March is 5G technology. Now, you may be familiar with 5G technology from something you read in the news or potentially a little icon at the top of your cell phone. What 5G is, is the fifth generation of wireless technology. And why is that big? Well, it's a story that goes beyond just the cellular network and goes into your homes and even into your cars.</p> <h2>Ted:</h2> <p>So why is the month of March the time that people should be more focused on 5G?</p> <h2>Patrick:</h2> <p>So when you think about the future around what this rollout, and why today, 5G technology is starting to actually get into the hands of consumers everyday now. So, people have been waiting to kind of upgrade for that new phone. You may have been thinking of upgrading your new smartphone; but 5G technology wasn’t going to be available for it until this year. You’re starting to see that become the baseline functionality for all of those smartphone features over the next year and two. And so, you’re going to see more and more people leveraging that technology in their everyday life.</p> <p>But what it means beyond kind of the cellphone industry is that all of the technology and capabilities that you can connect to is even broader. So, when you think about how fast is fast with 5G, it's about a hundred times faster than your 4G wireless connection today. And what that starts to compare to is potentially the Wi-Fi or the Ethernet cord that you're running your home Internet on, of which is the fiber optic cables to your home, it's potentially as comparable to that. And you start to open questions around, do I need this Internet at home? Can I rely just on this 5G network? And there's potentially a big opportunity to grow beyond just what your everyday use is for your data.</p> <h2>Ted:</h2> <p>So in a world where people are now expecting to be able to do what they want when they want it, 5G will enable that even more?</p> <h2>Patrick:</h2> <p>Potentially, yeah.</p> <h2>Ted:</h2> <p>Okay. Nellie, you're up next.</p> <h2>On screen:</h2> <p>Nelle Miller, Co-Head of New York, J.P.Morgan Private Bank.</p> <h2>Nelle:</h2> <p>Well, Ted, you know, first of all, I'm disappointed that we don't have the star-studded jackets like your episode for New Year's. So, I don't know.</p> <h2>Note:</h2> <p>Ted smiles.</p> <h2>Ted:</h2> <p>Just you wait, my friend, just you wait.</p> <h2>Nelle:</h2> <p>I just cannot wait to see. But so, its similar right? You talk about 5G making all of our lives really easy and efficient. I’m a big consumer stock person so I have a very long-term view when I think about investing. I also happen to be a working mom that’s running around doing lots of different things all day long, from buying pajamas to making sure there’s groceries in my refrigerator. And so, I like to buy things that I consume. So, when I think about that, I think about the apps that I use every day. This morning, I was buying a bunch of things on Amazon. This afternoon or tonight, my kids will likely be on that Disney Plus streaming service that just came out. Those are the kind of companies that I have in my portfolio, but the philosophy that I have is: you buy what you consume. Especially if you have a long-term focus, and especially if it’s sort of giving you an experience, and has a bunch of different products that they have within a company</p> <h2>Ted:</h2> <p>And I just want to reiterate, when you talk about buying something on Amazon or watching something on Hulu or Disney Plus, like that’s your life. You’re not putting a recommendation out there. And I think it’s tied nicely to that concept of owning what you know.</p> <h2>Nelle:</h2> <p>Owning what you know.</p> <h2>Ted:</h2> <p>If you want to be a long-term investor there’s a higher probability that you’re going to stick to your plan and to your investments if you’re consuming it, if you’re using it. It’s not a recommendation, it’s how you live your life.</p> <h2>Nelle:</h2> <p>This is definitely how I live my life, and this is how I invest. But you are 100% right. All of these need to be well researched and looked at.</p> <h2>Ted:</h2> <p>Excellent. OK Stephen, we’re on to you. You're hearing a lot of ideas that may be new, maybe not, but they've all kind of worked over the last decade. You've got a little bit more of a contrarian take. What's your idea?</p> <h2>On screen:</h2> <p>Stephen Parker, Head of Advisory Solutions, J.P. Morgan Private Bank.</p> <h2>Stephen:</h2> <p>Well, I was gonna go with 6G because its 20% better than Patrick's idea, but instead I want to talk about going global. Look, the U.S. economy makes up about 20% of the global economy; yet the average investor in the U.S. has 75% percent of their portfolio invested in the U.S. Now that's been a great place to be over the last decade as the U.S. has consistently outperformed international markets; and some investors are actually asking whether they should own any non-U.S. stocks at all. But I think that's a mistake. The heart of it, diversification, is a fundamental part of the way we think about investing and taking that global mindset is really important.</p> <h2>Ted:</h2> <p>So Steve, this whole concept of diversification and thinking globally sounds a little actually complicated to me. If I am an everyday investor, maybe I have money in a 401K. Where should I take action? What are some of the things I should think about doing with this in mind?</p> <h2>Stephen:</h2> <p>Well, the thing that you have to realize, after 10 years of U.S. markets outperforming, if you look at your 401K or that account that maybe you haven't focused on in a while, that allocation to the U.S. today is going to be a lot bigger than it was when you started. So, as a course of discipline, I think this is a good time to revisit. Think about what your strategic starting point is. It's funny, I remember back in 2007, we had just gone through a five-year period where international markets had out-performed the U.S. by 120%. And investors at that time were saying, “Why should I own any U.S. assets at all?” And so, I think it's important when you're thinking about long term discipline and diversification, looking at international markets, like emerging markets, like Europe, makes sense.</p> <h2>Ted:</h2> <p>Nelle, one of the things that I’ve heard, anecdotally, is lots of clients not are only talking about the U.S., but they’re talking about equities. What are some of the things that you instruct them to think about when it comes to buying more equities within a portfolio?</p> <h2>Nelle:</h2> <p>I think that you-- really clients and everybody’s portfolios in a different stage. And so, you know, when you’re talking to someone that’s just got money, and is thinking they just sold their business, and they don’t know what to do with it, and they wanna talk about the equities market, that may be a different conversation where, you know, you gotta get a little skin in the game and start investing because the backdrop of the economy looks pretty good.</p> <h2>Ted:</h2> <p>Patrick, question for you. So, you talked about this mythical 5G. I would venture that there’s a bit of a 5G value chain. There’s lots of different types of companies that have exposure to this trend. Can you expand on that a little bit?</p> <h2>Patrick:</h2> <p>Absolutely, yeah. So, the main one that people are probably familiar with are telecom companies. So typically, you know, these areas have been tough to invest into in the past, just because they are highly capital intensive, particularly when they're rolling out new technologies. But kind of moving down that value chain as well, you know, you have the companies, those Internet of Things, that are going to be very much, you know, taking advantage of 5G connectivity. So, thinking about not only just the telecom upstream piece that are delivering the infrastructure to develop and roll out this 5G technology, but also all of the companies that are going to make your life easier that are using this internet for its advantage.</p> <h2>Stephen:</h2> <p>And keep in mind, 5G is a global theme, right? If you think about some of the biggest winners in the space, a lot of them are going to be around the world. Technology is the biggest sector in emerging markets. And that's where I think some of the biggest winners in this team are going to be.</p> <h2>Nelle:</h2> <p>And some of the best ideas and technology are coming from all across the globe.</p> <h2>Stephen:</h2> <p>That's right.</p> <h2>Ted:</h2> <p>I personally might be waiting for this 6G you speak of. OK friends, well thank you for joining me for the March episode of What's the Move? Remember, none of these are recommendations. You have to do your own homework before you invest. These are just some ideas to think about when you're thinking about investing. Actually, there's one more thing. For those of you that have watched some of the previous episodes, we've generally done something called the seasonal surprise. And this is the month of March.</p> <h2>Nelle:</h2> <p>Is this where I get my star-studded jacket?</p> <h2>Ted:</h2> <p>Actually, this time we're gonna do something different in the honor of St. Patrick's Day.</p> <h2>On screen:</h2> <p>Stage-crew members bring out a large rainbow-colored arch made of balloons.</p> <h2>Ted:</h2> <p>So, I'm going to ask everybody to stand up and act-</p> <h2>Note:</h2> <p>A pop sound resonates from the ceiling.</p> <h2>On screen:</h2> <p>Lots of green confetti falls from the ceiling.</p> <h2>Stephen:</h2> <p>That gave me a little bit of a heart attack.</p> <h2>Note:</h2> <p>Traditional Irish music plays.</p> <h2>Ted:</h2> <p>Whew, OK. We're going to learn how to do a little bit of Irish dancing.</p> <h2>On screen:</h2> <p>Ted's smiling guests are wearing Saint Patrick’s Day hats, novelty headbands and green-tinted shamrock shaped sunglasses! A red-haired woman with a green skirt and green striped socks, Caroline, demonstrates Irish step dancing.</p> <h2>Caroline:</h2> <p>Ready? Two three four. Point five, six, up seven, eight. Skip one, and two, skip three, and four.</p> <h2>On screen:</h2> <p>Caroline dances with a stiff upper body, long quick leg-movements, and an occasional spin.</p> <h2>Caroline:</h2> <p>Over to three, over to three. Point, hop back, spin, point hop back. Whew, good job you guys!</p> <h2>On screen:</h2> <p>Ted and Patrick have really got their legs moving! Everyone claps.</p> <h2>Caroline:</h2> <p>That was great, that was awesome! Now we’re just gonna bow.</p> <h2>On screen:</h2> <p>Everyone holds hands and bows together. Caroline high-fives the gang.</p> <h2>On screen:</h2> <p>J.P.Morgan. logo</p> <p>Legal disclosures appear.</p> <h2>On screen:</h2> <p>You Invest is a business of J.P. 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