August was a reminder that markets can surprise us.

While the month is often known for volatility, stocks and bonds both pushed higher. The S&P 500 gained 2.03%, extending the bull market, while the Bloomberg U.S. Aggregate Bond Index rose 1.20%. Meanwhile, the VIX fell off a cliff, falling -8.13%.

Despite ongoing concerns, trading was relatively calm, with volatility staying contained and investors encouraged by signals from the Federal Reserve.

The Data Driving the Story

• Inflation: Prices rose in line with expectations (per the Consumer Price Index report on 8/12/24), though “core inflation” (per the Core Inflation report on 8/29/25) ticked up more than the prior month. This keeps pressure on the Fed as it weighs when and how much to cut interest rates.
• Jobs: The labor market cooled, with fewer jobs added than expected and prior months revised downward (per Jobs Report on 8/1/25). Slower hiring contrasts with recent strong GDP growth, highlighting mixed economic signals.
• The Fed: The turning point came when Fed Chair Jerome Powell suggested at Jackson Hole that conditions may justify a rate cut in September. That revelation fueled optimism across markets towards the latter part of August.
• Corporate Earnings & AI: Tech leaders continued to shine. Nvidia and Palantir beat revenue and earnings expectations, and Intel received a vote of confidence with a new government stake, underscoring AI’s growing role in driving markets.

What This Means for You

We believe markets right now are defined by two competing forces:

• Excitement around innovation and growth opportunities (AI, technology, and more)
• Uncertainty about inflation, interest rates, and the labor market

That mix makes portfolio management more challenging. How do you capture upside potential for your clients without taking on more risk than they’re comfortable with?

How to Navigate

That’s exactly the problem our Portfolio Optimizer attempts to solve. Instead of guessing or relying on “experts”, the optimizer attempts to provide us a way to build portfolios that adapt to current market conditions and your clients’ goals.

Here’s how it is targeted to work for you:

• Clear Objectives: Whether your priority is steady growth, limiting volatility, or maximizing risk-adjusted returns, you can set the optimizer to focus on what matters most to your clients.
• Scenario Optimization: We can see how your portfolio might hold up under different scenarios — like if inflation stays sticky, or if rate cuts drive a rally.
• Customization: Every investor is different. We can aim to set limits on how much exposure you have to certain sectors, include or exclude specific companies, and adjust how much risk your portfolio takes on. Streamline portfolio construction to client suitability.
• Better Insights: Once optimized, you should be able to compare the new portfolio against your current one, showing you in plain terms where your clients are taking on more or less risk and how expected returns might improve.

Why It Matters Now

With markets balanced between opportunity and uncertainty, flexibility is key. August reminded us that both optimism (AI growth, Fed support) and caution (inflation, jobs) will continue to shape the path forward.

The good news? You don’t have to choose between chasing returns or avoiding risk. With the right tools, you can quickly design and adapt portfolios — keeping your clients on track, no matter what the next few months bring.

Disclosure

The S&P 500 is a stock market index weighted by market capitalization that is made up of 500 of the largest public companies in the United States.

The Bloomberg U.S. Aggregate Bond Index is an index that tracks the performance of the investment-grade, US dollar-denominated, fixed-rate taxable bond market. It is a broad market measure that includes government securities (Treasuries), government-related debt, corporate bonds, and mortgage-backed and asset-backed securities

VIX is the ticker symbol and popular name for the Chicago Board Options Exchange’s CBOE Volatility Index, a popular measure of the stock market’s expectation of volatility based on S&P 500 index options.

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