Why You Should Lower Expectations for Making Money in Stocks

Plus: Top-performing bond funds with high yields; cheap utilities stocks. [Morningstar](?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_smartinvestor&utm_content=40175&elqTrackId=055936d14ca34dbdae12f5df4c581fe6&elq=5bae2950d3b74787b91f0efc9a08511e&elqaid=40175&elqat=1&elqCampaignId=19046) [Smart Investor] Smart Investor [Tom Lauricella, chief markets editor]( Twitter: [@LauricellaTom]( [Tom Lauricella] In this week’s newsletter: - [Are bonds a better bet than stocks right now?]( - [Top-performing bond funds with high yields]( - [Utilities are finally cheap again]( - [Why future returns on stocks probably won’t be so hot]( What a wild week. Crypto [seriously imploded](. The Twitter circus went private–but not without some parting [lessons for investors](. And stocks staged a ginormous rally on an inflation report that, while better than expected, definitely [won’t keep the Fed from additional significant rate hikes](. With Thursday’s big rally, it may seem like the wrong week to talk about how investors need to tone down expectations for how much money can be made in stocks. But regular readers of this newsletter know that one of our ongoing themes is we’re likely in a very different environment for investing than we’ve seen for the past four decades. The last ten years, in particular, have been about the stock market. But if you’re wondering where to invest right now, as Morningstar Investment Management’s Marta Norton tells us, the calculus is changing. Where should you be looking? Our story on why bonds may be a better bet than you think can be found [here](. And to help you out, we’ve screened for some high-yielding, [top-performing bond funds](. That’s not to say that there aren’t opportunities in stocks. Utilities stocks, with their fat dividends, are [finally cheap again](. Meanwhile, we highlight [10 cheap stocks with safe dividends]( and [five stocks]( that are under pressure now, but our analysts think have major upside. Still, when it comes to bonds looking attractive, it's more than just today's markets that we're talking about. In our story below, columnist Sandy Ward spoke to experts at Vanguard, Research Associates and elsewhere about their long-term forecasts for returns on stock and bond markets around the world. Their takeaway: We all could be in for a period of lower-than-usual returns on our stock portfolios. [Why Investors Should Lower Expectations for Making Money on Stocks]( [Why Investors Should Lower Expectations for Making Money on Stocks]( Vanguard, others predict bonds will rival single-digit returns on stocks; best bets are overseas. Sandy Ward [Read More]( Share: [facebook]( [twitter]( [linkedin]( ADVERTISEMENT [media]( [media] Markets and the Economy [12 Top-Performing Bond Funds With High Yields]( [12 Top-Performing Bond Funds With High Yields]( With bond yields at their best levels in years, a look at what some Morningstar Medalist funds have to offer investors. Katherine Lynch [Why We Expect Inflation to Fall in 2023]( [Why We Expect Inflation to Fall in 2023]( What could longer-term inflation look like? A deeper look at the data suggests less reason for concern. Preston Caldwell [Government Debt and Inflation]( [Government Debt and Inflation]( Taking the global perspective. John Rekenthaler [What to Invest in During High Inflation]( [What to Invest in During High Inflation]( These inflation hedges can help protect your portfolio. Margaret Giles [5 Undervalued Stocks—Even After Fair Value Estimate Cuts]( [5 Undervalued Stocks—Even After Fair Value Estimate Cuts]( While near-term pressures weigh on these stocks, analysts think they have major upside. Jakir Hossain [What Could the Midterm Election Results Mean for the Stock Market?]( [What Could the Midterm Election Results Mean for the Stock Market?]( Pay closer attention to economic and geopolitical catalysts than elections. David Sekera [How Twitter Stock Investors Got Lucky]( [How Twitter Stock Investors Got Lucky]( 3 Lessons for investors from Elon Musk’s bid and the Twitter soap opera. Sandy Ward [How a New Retiree Can Confront Market Turbulence]( [How a New Retiree Can Confront Market Turbulence]( A 72-year-old retired engineer seeks a review of her withdrawal rate and her portfolio positioning. Christine Benz Chart of the Week [Are Bonds a Better Bet Than Stocks Right Now?]( [Are Bonds a Better Bet Than Stocks Right Now?]( Morningstar Investment Management’s Marta Norton lays out the changing calculus for investing across the markets. Lauren Solberg [Read More]( Share: [facebook]( [twitter]( [linkedin]( Popular This Week [10 Cheap Stocks With Safe Dividends]( These stocks in the Morningstar Dividend Yield Focus Index look undervalued today. Susan Dziubinski [The Upside of Losing]( One step backwards, two steps forward? John Rekenthaler [3 Cheap Stocks for Patient Investors]( We trimmed our fair value estimates on these stocks, but we think they remain compelling ideas for long-term investors. Susan Dziubinski [Why Dodge & Cox Income Fund Is Tough to Beat]( This top-rated bond fund has outperformed most others during the past decade. Here’s how. Sam Kulahan [10 Reasons Why ESG Won’t Be Stopped]( Although demonized, ESG and sustainable investing will survive the backlash. Leslie Norton [Investing Insights Podcast: Cheap Stocks For You to Consider]( With markets so cheap right now, where should you invest? Starbucks and Uber are both undervalued – plus, many workers are worried with news of layoffs, how should you control your emotions? Listen Now Get the latest investing insights and market updates with [Morningstar’s podcasts]( available on your iPhone, iPad, Android, PC, or smart speaker. Stay connected: [twitter]( [facebook]( [linkedin]( [instagram]( [YouTube]( [Apple News]( [View online]( | [See all newsletters]( | [Share your feedback]( [Unsubscribe]( from this newsletter. Or update your [email preferences](. © 2022 Morningstar, Inc. All Rights Reserved. 22 W. Washington St. Chicago, IL 60602