In this Q&A, Ryan Detrick, Chief Market Strategist at Carson Group, shares insights on how advisors can navigate changing markets and the impacts of political and policy change in Washington on the U.S. economy as a whole.

If your 2025 outlook could be condensed into an elevator speech, what would you say?

The good times very well continue. From a strong labor market, to record earnings, to improving inflation, to a broadening out of this bull market, to strong productivity, there are many reasons we continue to expect solid gains in ’25 for investors. Yes, stocks have gained 20% two consecutive years and this year we expect between 12-15% gains, but many of the drivers that got us this far are still in play.

What is one thing wealth advisors often misunderstand about how markets work?

Bull markets tend to last a lot longer than many think. This bull market is now in its third year, and we found five other bull markets going back 50 years that made it this far. Wouldn’t you know it, the average bull lasted eight years, with the shortest being five years. History doesn’t repeat, but it often rhymes and if this happens again, we’d suggest positioning for continued gains would be very prudent.

Can alternative investments help guard against the impacts of wild economic swings?

Stocks and bonds are what a lot of people think of when they think about investments, but alternatives are becoming more and more important. Look at a year like 2022, when stocks and bonds both were lower. Although that is rare, it was reminder that having non-correlated assets in a portfolio can not only save sanity, but also portfolios. As this economic cycle ages, having some non-correlated assets like alts is going to be very important for investors.

What impact will artificial intelligence have on the investment and planning community?

AI already has had an incredible impact on investors, as large cap tech has been the top performing group the past two years over AI excitement. The truth though is now things could get a lot tougher, as companies need to justify all the spending on capital expenditures, and this means they need to produce earnings. Simple English: The bar is high for tech stocks here and a high bar can sometimes be hard to clear. We see no reason not to expect AI to be huge, but just like the internet 25 years ago, this doesn’t mean all investments will work out. We think it is important to keep a diversified portfolio and not get too top-heavy investing in purely AI-based things.

Is inflation still a factor? How should advisors address this issue?

Inflation has been stubborn due to shelter and auto insurance. Both are lagging data pieces and if you look at real-time data, we already have inflation sub 2%. For example, real-time rent prices are negative year-over-year, while the government says rent prices are up close to 5%. Without getting too in the weeds, this has to do with how the government tracks rent prices, but the truth is inflation is much better off using real-time data. We continue to expect to see improvement in overall inflation in 2025, which should be a welcome sign for the Fed, as the Fed doesn’t want to cut rates and see inflation come soaring back. To us, the path is set for potentially three cuts this year, mainly thanks to improving inflation, which is more than the market has priced in currently.

Learn more about Ryan Detrick, Carson Group, and Ryan’s podcast with Sonu Varghese.