Should US Equity Investors Fret About Rising Yields?
Not in the near term. The current environment of rising, but low, interest rates accompanied by strong earnings growth expectations is supportive for equities.
Equities
Decades of Data: 1900–2017
In over 40 different analyses and 100 charts, our annual report on the history of global markets provides context for the range of returns investors can expect from equities, bonds, and cash; reveals the importance of various components of equity returns; examines the evidence for equity mean reversion; and reviews the relationship between initial valuations…
Investment Publications Highlights: First Quarter 2018
First quarter’s edition summarizes four articles on trend following. The first article finds that trends are a defining characteristic of capital markets through time; the second argues that trend-following strategies act as risk-mitigation systems, rather than drivers of outperformance; the third suggests that the premium associated with trend-following strategies has faded in recent years; and the fourth considers the interaction between size and momentum strategies.
Global ex US Equity Manager Performance: 2017
In 2017, 75.8% of active Global ex US managers outperformed the MSCI EAFE Index gross of fees, with the median manager outperforming by 260 basis points. This chart book is our annual summary of the absolute and relative performance of managers that report to our database.
US Mid- to Large-Cap Equity Manager Performance: 2017
Despite strong overall returns, active managers continued their now four-year streak of underperformance against the index, with 54.4% underperforming (gross of fees) in 2017. For the year, the median US mid- to large-cap manager underperformed the Russell 1000® Index by 70 basis points. This chart book is our annual summary of the absolute and relative performance of managers that report to our database.
Should Investors Be Concerned that the Number of Listed US Stocks Has Dropped by Half Since 1996?
No. The US public equity market remains the largest and most liquid in the world and continues to offer a robust opportunity set for investors.
With the Recent Surge in Volatility, Should Investors Modify Their Asset Allocation or Exit Systematic Strategies?
No, most investors should sit tight. The persistence of strong corporate and macroeconomic fundamentals in the face of the recent sell-off and spike in volatility strongly suggests that the duration of the market rout should be limited.
Is the Environment for Active Management Improving?
We are asked this question on a regular basis, but believe it is fundamentally the wrong question for investors to ask if they are seeking to outperform the market over the long term.
Australia Outlook 2018: Reaching a Tipping Point
Though the risk from rising rates is potentially higher in Australia than elsewhere given household debt levels and the state of the housing market, we judge the risks and outlook as balanced and advise investors to remain neutral on equities and risk.
New Zealand Outlook 2018: The Times They Are A-Changin’
The risks from rising rates are potentially higher in New Zealand than elsewhere given the overvaluation of equities and the housing market. We advise investors to underweight NZ equities, fixed income in general, and the NZ dollar.