Are Earnings Running Out of Gas?
The risks to U.S. corporate profits are underappreciated.
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New Equity Indices Are Quite Stylish
New style indices have significantly improved the choices available to style-conscious investors and managers.
Why Are Interest Rates so Low? Exploring the Conundrum
Yield curve movements since June 2004 have shown how difficult it is to forecast—let alone explain—the twists and turns of interest rates.
How to be Bullish
While a continued rally is not our base scenario, a plausible argument can be made that U.S. equities are attractively priced and thus poised to move higher.
U.S. TIPS Look Before You Leap
With real yields of just 1.6%, ten-year U.S. TIPS are currently an expensive inflation hedge.
U.S. Equities Are Cheaper, but Fewer Values Remain
With valuations more concentrated, style and market cap should be weaker drivers of return.
Earnings Growth: Don’t Bank On It
The financial sector contributed 30%–40% of S&P 500 earnings in 2002–04, but odds are against this trend continuing.
History and the Latest Bear Market Rally
While the latest rally has been far more explosive than others since the onset of the bear market in 2000, from an historical perspective it is rather pedestrian.
US Pension Plans: Investment Considerations for Endowment Professionals
This paper provides a framework for assessing nonpublic defined benefit pension plans by examining the key characteristics of pension liabilities, various risks to consider during the asset allocation process, and risk immunization. Exhibits cover pension fund performance, liquidity constraints, liability duration, and a comparison of asset allocation differences between pensions and endowments.
Thinking About Risk?
In the fall of 2002, a confluence of factors supported greater risk taking. Today, the same factors suggest that investors focus on risk reduction and diversification.