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Matthias Knab, Opalesque:

Franklin Templeton Investments writes on Harvest Exchange:

Two Sides to Every Story-and the Truth

In a recent Bloomberg interview, legendary investor Howard Marks of Oaktree Capital said that investing is "never black or white, in or out, risky or safe." He suggested that investing is about continually calibrating your portfolio across a spectrum of risk-from aggressive to defensive. We could not agree more.

The media likes to hear market calls. They like pundits who say "get out now," "buy now," or "it's time," etc. We don't believe anyone can ever be that certain. Most of the time the correct action is somewhere in between. We can never know what the future will hold, but we can get a sense of potential outcomes by looking at what the past gave us, and where we stand in the present. The amount you have invested, your exposures across various asset classes and sectors and the presumed riskiness of each in the context of the current market. These are all things we can consider.

So where do we stand today? From our perspective things are looking a bit frothy. Again, this is not a market call. This rally could continue on for another year or even longer-who could know? What we do know is where we are relative to historical context.

Consider the equity markets, for example. The chart below......................

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