Peter Mallouk's Predictions for Advisors, Firms and the Markets in 2024

What that's going to do going forward is you'll still see acquisitions — because we're in the early stages of the consolidation of the industry … but the number of deals that each of these firms is willing to make will likely decline, and the structure of these deals is going to change. 

For bigger firms, it's like if you were going to buy real estate, the interest rate you pay definitely impacts the prices in the market. It's no different at all when it comes to wealth management firms. 

When you look at the activity in this space, interest rates are probably the biggest factor right now. And, obviously, a market decline of [any] significance means you would see almost a complete freeze of M&A activity.

What did you see as most significant in the markets in 2023?

We just saw the run-up of big U.S. stocks outperforming everything else yet again. We saw it happen primarily because of just seven stocks yet again, and it's just incredible. 

This was despite everyone's predictions — BlackRock, Vanguard, Goldman Sachs, etc. — that this [performance] would flip and we would see smaller stocks do better … or we would see international outperform the U.S. This is something that is going to have to flip at some point. But it was amazing to see that not happen for yet another year. 

What's your view on trends in the markets in 2024?

We're going to see bonds start to perform much better after one of the longest stretches of the worst performance they've ever had.

As bond yields stabilize, or maybe even in the next year decline modestly, we'll see bond performance be much much stronger because interest rates are higher now. The expected return is much better. Also, the dramatic spike up [in yields] is largely over. 

What developments of 2023 most surprised you? 

The banking contagion that almost happened was probably the most surprising, and the way that it got contained so quickly was also surprising. Overall, I was surprised that it happened, and it was surprising that it didn't have a greater domino effect. I think that really speaks to how aggressive [federal regulators] are with interfering with these sorts of things. 

What's your or your firm's New Year's resolution for 2024? 

Our focus here for the 2020s is "better." It's the word that we're all using. We just want to be better at everything that we do and that's our focus now. If we're spending our time on [something], is it making the client experience or offering better than it was before? That's the focus, and we're already on our way. 

Finally, what would you like to tell us about your latest book, "Money Simplified?"

I really wanted to have a book that was really straightforward and really explained money in a way that someone who wasn't really interested in it could read very quickly — maybe 25 minutes or less — that's highly illustrative and very visual, so they could come away with a good understanding of the markets, how they work and why that's important. I'm excited about it. 

(Credit: Janie Jones)