Skilled active management can provide returns above broad-based market benchmarks over time using a variety of techniques such as factor based investing. Value and momentum can be helpful in generating attractive returns relative to the amount of risk taken.

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At the halfway mark of 2017, the dominant market themes are the same as when the year started, like the Trump economic plan and the Federal Reserve’s decision-making. An optimistic vision of economic growth under Trump lifted asset prices in the months following the November election. Investors rushed to position themselves for major tax cuts, regulatory rollbacks and an infrastructure boom. Over the past eight months, some regulatory actions have been taken, but the rest is still in the promise phase.

As we approach the midpoint of 2017, investors are still trying to make up their minds about the Trump agenda. Primarily they are trying to decide whether to keep hoping for results or to write it off. Whatever they end up deciding may have a sizable impact on how the second half of the year plays out.

Strengthening demand, so-so supply – this is the municipal bond market in a nutshell. The result of this imbalance is rising muni prices, as more cash in the market chases fewer securities available for purchase. The total return for the asset class was just under 4% through the first five months of the year; this compares to a 0.2% total return for all of 2016.

Investors hoping for a surprise out of this week’s Federal Reserve meeting are not going home disappointed. As anticipated, the Fed voted to raise short-term interest rates by another quarter-point. This latest rate increase is the fourth in a slow tightening trend that began in December 2015.