European Valuations
Our dividend discount model indicates that U.K. equities are now fairly valued, while continental European equities are slightly undervalued.
Research Publications Archive
European High-Yield Market
Economic integration, the trend of deregulation and privatization, surging M&A activity, and the increasing acceptance of leverage in corporate financing have provided the catalyst for an expanding European high-yield market.
Global Correlations
Correlations between regions are high, but not extraordinarily so or unprecedented. What’s more, correlation methodology has a tremendous effect on the interpretation of actual correlation of returns. The starting point and frequency of the data (month, week, or day) can skew the statistics one way or the other and currency denomination has a significant impact….
Inside the U.S. Equity Market
The persistent disparity among valuations across different sectors indicates the likelihood that high P/E stocks will continue to disappoint; while overlooked issues at the other end of the valuation spectrum should outperform. The proportion of lofty P/E stocks within the overall market is gradually shrinking. Despite value’s trouncing of growth last year, we suspect this…
Global Distressed Investing
An examination of types of distressed opportunities and strategies, and the historical performance of distressed funds. Exhibits cover distressed capital structure, sample fund composition, and a review of terms.
U.S. Treasury Inflation-Protected Securities: Fixed Income Substitute?
This report focuses on TIPS` behavior during severe economic contraction, evaluating whether a portfolio composed of equities and TIPS will weather a prolonged economic contraction as effectively as a more conventional portfolio composed of equities and nominal bonds. The report provides a supplement to our previous research report on TIPS.
U.S. Treasury Inflation-Protected Securities (TIPS)
An introduction to U.S. TIPS, their performance and correlations to other assets classes, as well as the various rationales for a TIPS allocation and investing strategies.
Behavioral Finance
An evaluation of common mistakes made by investment committees including overrating the importance of recent information, oversimplification of complex issues, extrapolation of past results into the future, and diffusion of responsibility.
Enhanced U.S. Equity Indexing
Investors index to achieve portfolio diversification at the lowest possible cost, but abandon any chance of outperforming the chosen benchmark. In contrast, active investors pay higher fees and incur the risk of underperforming the benchmark because they believe their managers will add value over time. With lower fees than active management, close benchmark tracking, but…
Equity Market Timing, Valuations and Momentum Investing
This brief report argues against several popular market-timing strategies and examines the potential risks and rewards of momentum investing for short- and long-term investors.