A $60 billion investing firm just unveiled specific 7-year forecasts for 11 different assets — and they suggest the market as we know it could be flipped upside down

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In the face of adversity, GMO's asset allocation team is taking an against-the-grain stance on the outlook for global markets over the long term.

Of particular interest to GMO is the appeal of low-multiple value stocks, which have been downtrodden in recent years. Put simply, the firm thinks they're too good of a deal to pass up.

"The dispersion within equities is particularly interesting as the valuation gap between US and international equities is closest to the widest it has ever been, and we are also seeing wide spreads between value and growth," GMO said."We have not seen value trade so cheaply on a broad level across equity markets since the 2000s.

In spite of this notion, GMO thinks it's time to go all-in on this underperforming area. According to their forecast, investors should be able to enjoy robust 5%-9.5% real returns in emerging markets and emerging markets value.

 

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GMO's track record of predictions is .... sub-optimal.

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