Much statistical analysis in finance depends on the assumption that variables have normal distributions. This assumption is far from correct. As a result, as Nassim Nicholas Taleb has rightly pointed out, most statistical results in finance are wrong. Now, a disciple of Taleb has tried to extend Taleb’s research by relating it to an obscure mathematical concept.
"Travel on all roads and streets changed by -10.3% (-28.1 billion vehicle miles) for December 2020 as compared with December 2019. Travel for the month is estimated to be 244.1 billion vehicle miles." The 12-month moving average was down 0.98% month-over-month and down 13.2% year-over-year. If we factor in population growth, the 12-month MA of the civilian population-adjusted data (age 16-and-over) was down 1.04% month-over-month and down 13.5% year-over-year.
Our positive 2021 economic outlook, combined with better-than-expected company fundamentals, supports strong credit performance and spreads.
The Great Inflation of the 1960s and 70s, the earliest stages of which were already underway when Graham spoke at the St. Francis Hotel, eventually produced some of the most astonishing economic dislocations in U.S. history.
Franklin Small Cap Value Fund Portfolio Manager Steve Raineri discusses why he thinks the near-record underperformance of higher-quality, profitable small-capitalization (small-cap) value stocks relative to lower-quality, unprofitable companies could present a compelling opportunity for longer-term investors as the US economy continues to recover from the COVID-19 pandemic.
For bond investors, inflation is pretty much all bad news, eating into the value of future returns. For equity traders, the tidings can be less categorically awful, given the ability of certain companies to wring profits from higher prices.
There are times when you are called to advocacy. As a profession, this is one of them. Advisors are the stewards, the informed, the protectors, and if there is a force that stands between the next generation of investors and financial devastation, it is you.
Many investors think there are only two options in a market where participants have become overly exuberant, either 'I want in' or 'Get me out.' Our strategies are more nuanced, and we believe fit better with what we expect to transpire.
FINRA has released new data for margin debt, now available through January. The latest debt level is up 2.6% month-over-month and is at a record high.
It’s tempting these days for some investors to question the role of fixed income in portfolios. After all, real yields have plunged, potentially leading to less income today and smaller capital gains tomorrow.
It’s another milestone for Cathie Wood’s Ark Investment Management. Less than two weeks after hitting $50 billion in assets, the red-hot firm now manages more than $60 billion, as funds flow into Wood’s exchange-traded funds at the fastest pace ever.
Is inflation coming? At some point, yes. We know what generates inflation, and we will be watching for it. Until then, we do not expect a wildfire in inflation land.
The accompanying chart is a way to visualize real GDP change since 2007 and uses stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics.
With U.S. equity valuations very rich by historical standards, many – including Jeremy Grantham, Rob Arnott and Vanguard – are predicting emerging markets to excel. I’ll examine the case and give my thoughts on how to invest in emerging markets.
Factor-based models are often criticized for data mining. One way to address that charge is with “out-of-sample” testing over longer time frames. But that takes time. New research provides an alternative out-of-sample test – using emerging-market bonds.
It’s more than enough money, at going prices, to buy one GameStop, two AMC Entertainments and four Bed Bath & Beyond's.
I don’t say this often, but Fed Chairman Jerome Powell is wrong. Regular readers of our investor letters and other publications will recall that we regularly cite Chairman Powell as doing the best he can with the levers he has while arguing correctly for others to do their part.
The top performing exchange-traded funds so far in 2021 have at least one thing in common: They all track the pot industry.
Relative value currently favors floating-rate loans over high-yield bonds.
As quickly as it soared to the moon, GameStop came back down to earth; but the lessons learned are key to turning day trading speculators into longer-term investors.
Fortunately, human behavior has a history of repeating itself at extremes. The worst buying decisions are made at the top. Just like bonds, the convexity is true when yields rise going forward. It’s a slippery slope and could be vexing.
At some point, interest rates will move higher. Advisors must understand the inherent risks, and proactively evaluate alternatives for their fixed income portfolios to manage through successfully.
With fixed income yields stubbornly low, should clients prepay their mortgage instead of investing in bonds? I argue this question is based on a false equivalence.
2021 has certainly started off interesting. From Reddit readers chasing the most heavily shorted stocks, to the new Administration discussing more stimulus, investors have had plenty to deal with. A market review seems appropriate as the bulls seem to remain bulletproof even as the mania grows.
It’s hoped that an extra $1,400 in the pockets of everyday Americans may help support lagging U.S. consumption. We believe the stimulus, along with improved vaccine roll out, may also help support commercial air travel.
This morning's employment report for January showed a 49K increase in total nonfarm payrolls, which was slightly below the Investing.com forecast of 50K jobs added.
Treasury yields continued to march higher in January, with the move again concentrated in longer maturities. Mortgage spreads tightened slightly, while corporate bond spreads were mostly mixed. The market remains stuck between the push/pull of the prospect for greater fiscal stimulus and ongoing vaccine rollout versus continued lockdowns and the greatest one-month mortality rate since the pandemic began nearly a year ago.
The coronavirus pushed three dozen municipal-debt issues for senior living communities into default last year and another five have already missed payments in 2021, sowing distress in one of the nation’s safest bond markets.
Collateralized loan obligations are the largest source of demand in the loan market. Cheryl Stober breaks down some key drivers of CLO manager behavior.
Internet message boards are lighting up and certain stocks have seen some unusually dramatic price moves. David Mann, our Head of Global Exchange Traded Funds (ETFs) Capital Markets, ponders whether ETFs could be subject to similar volatility.
Nothing so animates a speculative herd as a parabolic price advance in an asset detached from any standard of value. I am convinced that future generations will use the present moment to define the concept of a reckless speculative extreme, in the same way our generation uses “1929” and “2000.”
The purpose of the Constitutional gold standard was to establish a reference point against which the prices of credits and commodities were set by the open exchange of bank notes and other promises to pay money.
The Fed recognizes their ongoing monetary interventions have created financial risks in terms of asset bubbles. They are also aware that most policy tools are likely ineffective at mitigating financial risks in the future. Such leaves them being dependent on expanding their balance sheet as their primary weapon.
The rationale behind the meteoric rise of Gamestop, a chain of videogame rental stores, and AMC, one of the nation’s largest cinema operators, is too unlikely to be believed. In just one month both stocks had risen by more than 600%.
Treasury Secretary Janet Yellen met with small business owners on Thursday. Senate Republicans criticized moves by Democrats to fast-track President Joe Biden’s $1.9 trillion Covid-19 relief plan without their backing.
Bank loans offer some of the highest yields in the current interest rate environment. We believe their unique characteristics may prevent many investors from considering them, but it may be a mistake to overlook them.
The Mortgage and Structured Finance Sector Team discusses key themes in the securitized market in 2021.
For all Millennial readers, if you visited a casino in your lifetime only to see your money quickly disappear, you have not seen anything compared to trading versus professionals. So to all you Robinhood traders I say, “Welcome to the Jungle.”
The future of financial advice is evolving. The real value of an advisor not only requires the ability to build a plan and portfolio, but to guide clients through the process, unearth their values and emotions, and change their behavior for the better. A realm of the relationship is called the human side of money. Here today to talk about that human side and how advisors can leverage the science of behavioral finance is Brendan Frazier.
Calls for fiscal stimulus measures to target infrastructure are growing. But new research shows that infrastructure investments have offered few benefits to investors.
The illusion of surging savings rates or the decline in the debt-to-income ratios obfuscates the real economic problems and fosters the belief that monetary policies are working. They aren’t.
We can’t predict the future. If we could, fortune tellers would all win the lottery. They don’t, we can’t, and we aren’t going to try. However, this doesn’t stop the annual parade of Wall Street analysts from putting out forecasts on the S&P 500.
After working with hundreds of financial professionals to improve their digital presence, I’ve noticed some trends in what is and isn’t working to garner more engagement.
Everyone agrees that selling virtually is a whole different thing and most of us feel ill-equipped to do it well.
Our K2 Advisors team is optimistic about the opportunity set in the year ahead, and thinks that active management alpha will be key to success in 2021. Brooks Ritchey and Robert Christian provide the team’s first-quarter hedge-fund strategy outlook.
President-elect Joe Biden’s $1.9 trillion Covid-19 relief plan is designed to both pump money into the economy and contain the coronavirus pandemic.
The trouble with bubbles is they prey on human weakness. They are also high impact investment events.
Loomis Sayles' Global Credit Sector Team shares their outlook on key themes in the euro credit space.
Credit markets have staged an epic rebound from the depths of March 2020. But in a low-growth, low-yield world, we believe there may be more room to run in 2021.
The US state of Georgia held January runoff elections that determined two Democrats as their US senators, giving the Democratic Party control of the legislative and executive branches through 2022.
The Loomis Sayles Emerging Markets Debt Sector Team shares their views on corporate spreads, foreign exchange and leverage in 2021.
The dichotomy of “value” and “growth” investing has become a sharp stylistic divide. But is it helpful? Howard Marks writes in his latest memo how he views the art and science of value investing, especially in the increasingly efficient and complex world we face today.
The Fed juices the stock market in four ways.
Whereas commodity production had been a major economic driver in emerging markets, we think technology is now the leading force. Semiconductor advancement is the “new oil.” semiconductor companies are so far ahead of their competitors that supply is in fact a constraint—and therefore a major investment consideration.
As we enter 2021, there are two myths told to investors to support the bull market narrative. The first, as we debunked recently, is that low-interest rates justify high valuations. The second is that since valuations are not as high as the “dot.com” crisis, there is no “stock market bubble.”
Ashish Chugh discusses his outlook on EM equities in 2021.
As we have noted previously, one cannot practically ignore the celebration regarding our annual lap around the sun, although I think it’s fair to say that there are roughly 7.5 billion people outside of Silicon Valley—or those who run large cap growth/tech funds—that are delighted to see 2020 declared over.
Free from a house view on economies, markets or stocks, J O Hambro Capital Management’s (JOHCM) fund managers invariably see the world in different ways. We asked a number of our managers for their thoughts on the outlook for their asset class next year, what they would like to see and the possible surprises that 2021 could bring.
As the new year begins, the investment grade (IG) market faces multiple challenges, including a recovering economy, low yields, tight spreads, and record high duration. At the same time, market technicals remain favorable, fundamentals are improving, and there are attractive sectors in the index. Overall, we are modestly bullish about 2021 and feel there are compelling opportunities for those who know where to look.
The world economy will be exiting the pandemic weighed down by much bigger debts and increased inequality that could hobble growth in the longer term.
The performance of ESG funds has been unimpressive, according to new research, and the occasional outperformance is driven mainly by funds’ expenses, exposures to certain industries and factors.
Insurers generally take a narrow approach to investing in the securitized sector, usually through allocations in their investment grade fixed income reserve portfolios.
In the current bull market advance, few people are willing to sell, so buyers must keep bidding up prices to attract a seller to make a transaction. As long as this remains the case, and exuberance exceeds logic, buyers will continue to pay higher prices to get into the positions they want to own.
Although some on the committee agreed with the market consensus for a moderate continuation of economic growth and equity markets, the majority agreed with a more positive scenario in which the global economy outperforms market consensus, while equities, especially those outside of the US, rally sharply.
In October, I discuss how the “2nd Derivative Effect” would mute the impact of future stimulus programs. With the passage of the $900 billion stimulus package, we can update the estimates for the economic impact heading into 2021.
“Maybe this time is different. Those words, supposedly the most dangerous to utter in the investing realm, came to mind amid the frenzied pops in the highly anticipated initial public offerings recently.” That quote was from Randall Forsyth discussing why the current market mania reminds him of the “Shades of 1999.”
I rounded up the six key reasons your marketing strategy will fail in 2021 and how to avoid them.
To organize your team and prepare for the year ahead, take your team through the steps.
There is strong demand for steady income. However, most investment products and strategies fail dismally in this regard.
From global responses to local lockdowns, we all witnessed dramatic changes in 2020.
Broadridge recently released its second annual financial advisor marketing survey which revealed the contrasts between effective and ineffective marketers, as well as an expected move to digital due to the continued impact of COVID-19. This year’s survey also shed light on the lack of marketing strategy among advisors and in turn, dissatisfaction with marketing ROI.
They were once America’s corporate titans. Beloved household names. Case studies in success.
There is much to debate about the current level of interest rates and future stock market returns. However, what is clear is the 40-year decline in rates did not mitigate two extremely nasty bear markets since 1998, just as falling rates did not mitigate the crash in 1929 and the subsequent depression.
With a COVID-19 vaccine rolling out and markets enjoying a post-election relief rally, credit investors may be asking “is there any opportunity left?”
Here are five ways you and your team can become more capable and organized around transitioning clients.
Here are a few ways to leverage video communication, like Zoom, so that it works to your advantage…
Recent SOE bond defaults signal Beijing’s willingness to let markets price risk more accurately.
The two Georgia Senate runoff races on January 5 will be among the most important elections in our lifetimes, whether you are a conservative or a liberal. As a result, enormous and unprecedented amounts of outside money are gushing into these runoffs.
We believe traditional fixed income should continue to provide a reliable source of diversification against a growth shock, but low rates and the risk of an inflation shock necessitate broadening the menu of diversifiers.
Many market participants expect major economies to follow a path to recovery similar to China’s, but we see three key factors that suggest China’s recovery may be on its own trajectory.
Although investors don’t normally think about trash when they’re looking for growth stocks, we believe the solid waste industry is well-positioned to outperform. In our view, the combination of high barriers to entry, stable demand, and opportunities for consolidation should provide reliable revenue growth for the foreseeable future.
This mass exodus of breakaway brokers hasn’t happened, much to the chagrin of us prognosticators, and I know why.
More than most years, it’s hard to look ahead to the next year, to 2021, without looking back at 2020. A global pandemic, a massive economic collapse, a bear market, a surprisingly sharp reversal, a hotly contested election where passions ran high, the impact of lockdowns—it was an unusual year of extraordinary challenges.
The rally in energy companies is likely premature. To understand why such may be the case, we have to review a bit of history.
We highlight the reasons behind our pro-risk stance in our 2021 outlook in the weekly commentary.
There appears to be a few huge statistical bargains available in the stock market based on the simplified version of Benjamin Graham’s intrinsic value calculation.
Franklin Small Cap Value Fund Assistant Portfolio Manager and Research Analyst Nick Karzon gives five reasons why we continue to see attractive long-term opportunities for select small-capitalization (small-cap) P&C insurers.
Some changes unfold over time and it’s possible to see them coming. There are demographic changes coming in the next decade that will change the direction of the U.S., since the Silent generation and the Baby Boomers hold a different view of government than Gen Z’s and Millennials.
Whether you’re looking to dust off your CRM software and learn to better use its features, or you’re looking to make a CRM investment for the first time, here’s what you need to know.
Leveraged and Inverse Funds
Understanding Fat Tail Returns
Much statistical analysis in finance depends on the assumption that variables have normal distributions. This assumption is far from correct. As a result, as Nassim Nicholas Taleb has rightly pointed out, most statistical results in finance are wrong. Now, a disciple of Taleb has tried to extend Taleb’s research by relating it to an obscure mathematical concept.
America's Driving Habits as of December 2020
"Travel on all roads and streets changed by -10.3% (-28.1 billion vehicle miles) for December 2020 as compared with December 2019. Travel for the month is estimated to be 244.1 billion vehicle miles." The 12-month moving average was down 0.98% month-over-month and down 13.2% year-over-year. If we factor in population growth, the 12-month MA of the civilian population-adjusted data (age 16-and-over) was down 1.04% month-over-month and down 13.5% year-over-year.
High-Yield and Bank Loan Outlook - First Quarter 2021
Our positive 2021 economic outlook, combined with better-than-expected company fundamentals, supports strong credit performance and spreads.
This Era May Come to Be Remembered as the Federal Reserve’s Third Great Mistake
The Great Inflation of the 1960s and 70s, the earliest stages of which were already underway when Graham spoke at the St. Francis Hotel, eventually produced some of the most astonishing economic dislocations in U.S. history.
A Value Investor’s View on US Small-Cap Stocks
Franklin Small Cap Value Fund Portfolio Manager Steve Raineri discusses why he thinks the near-record underperformance of higher-quality, profitable small-capitalization (small-cap) value stocks relative to lower-quality, unprofitable companies could present a compelling opportunity for longer-term investors as the US economy continues to recover from the COVID-19 pandemic.
Inflation Angst Is About to Rewrite the Stock Market Playbook
For bond investors, inflation is pretty much all bad news, eating into the value of future returns. For equity traders, the tidings can be less categorically awful, given the ability of certain companies to wring profits from higher prices.
Don’t Let Your Clients’ Kids be the Next Reddit Victims
There are times when you are called to advocacy. As a profession, this is one of them. Advisors are the stewards, the informed, the protectors, and if there is a force that stands between the next generation of investors and financial devastation, it is you.
Spectate or Speculate
Many investors think there are only two options in a market where participants have become overly exuberant, either 'I want in' or 'Get me out.' Our strategies are more nuanced, and we believe fit better with what we expect to transpire.
Margin Debt and the Market: Up 2.6% in January, Continues Record Trend
FINRA has released new data for margin debt, now available through January. The latest debt level is up 2.6% month-over-month and is at a record high.
Fixed Income: Low Yields Don’t Tell the Whole Story
It’s tempting these days for some investors to question the role of fixed income in portfolios. After all, real yields have plunged, potentially leading to less income today and smaller capital gains tomorrow.
Cathie Wood’s ‘Phenomenal Rise’ Brings ETF Assets to $60 Billion
It’s another milestone for Cathie Wood’s Ark Investment Management. Less than two weeks after hitting $50 billion in assets, the red-hot firm now manages more than $60 billion, as funds flow into Wood’s exchange-traded funds at the fastest pace ever.
Why Printing Money May Not Create Inflation
Is inflation coming? At some point, yes. We know what generates inflation, and we will be watching for it. Until then, we do not expect a wildfire in inflation land.
An Inside Look at the GDP Q4 Advance Estimate
The accompanying chart is a way to visualize real GDP change since 2007 and uses stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics.
The Case for Emerging Markets
With U.S. equity valuations very rich by historical standards, many – including Jeremy Grantham, Rob Arnott and Vanguard – are predicting emerging markets to excel. I’ll examine the case and give my thoughts on how to invest in emerging markets.
An Out-of-Sample Test for Factor-Based Strategies
Factor-based models are often criticized for data mining. One way to address that charge is with “out-of-sample” testing over longer time frames. But that takes time. New research provides an alternative out-of-sample test – using emerging-market bonds.
Coleman Leads $23 Billion Payday for 15 Hedge Fund Earners
It’s more than enough money, at going prices, to buy one GameStop, two AMC Entertainments and four Bed Bath & Beyond's.
The Fed’s Blindspot
I don’t say this often, but Fed Chairman Jerome Powell is wrong. Regular readers of our investor letters and other publications will recall that we regularly cite Chairman Powell as doing the best he can with the levers he has while arguing correctly for others to do their part.
Pot ETF Trio Soars 90% to Open 2021 on Legalization Hopes, M&A
The top performing exchange-traded funds so far in 2021 have at least one thing in common: They all track the pot industry.
Loans or Bonds?
Relative value currently favors floating-rate loans over high-yield bonds.
Lesson Learned? Takeaways From the GameStop Saga
As quickly as it soared to the moon, GameStop came back down to earth; but the lessons learned are key to turning day trading speculators into longer-term investors.
Vexing Today’s Convex Pricing Behavior
Fortunately, human behavior has a history of repeating itself at extremes. The worst buying decisions are made at the top. Just like bonds, the convexity is true when yields rise going forward. It’s a slippery slope and could be vexing.
Rising Interest Rates Can Wreak Havoc on Fixed Income Portfolios
At some point, interest rates will move higher. Advisors must understand the inherent risks, and proactively evaluate alternatives for their fixed income portfolios to manage through successfully.
A Mortgage is Not a “Negative Bond”
With fixed income yields stubbornly low, should clients prepay their mortgage instead of investing in bonds? I argue this question is based on a false equivalence.
Bull Mania & The Charge Of The Light Brigade
2021 has certainly started off interesting. From Reddit readers chasing the most heavily shorted stocks, to the new Administration discussing more stimulus, investors have had plenty to deal with. A market review seems appropriate as the bulls seem to remain bulletproof even as the mania grows.
Could $1,400 Stimulus Checks Lift Air Travel Demand?
It’s hoped that an extra $1,400 in the pockets of everyday Americans may help support lagging U.S. consumption. We believe the stimulus, along with improved vaccine roll out, may also help support commercial air travel.
January Jobs Report: 49K New Jobs, Unemployment Rate Down to 6.3%
This morning's employment report for January showed a 49K increase in total nonfarm payrolls, which was slightly below the Investing.com forecast of 50K jobs added.
Total Return Perspectives: January 2021
Treasury yields continued to march higher in January, with the move again concentrated in longer maturities. Mortgage spreads tightened slightly, while corporate bond spreads were mostly mixed. The market remains stuck between the push/pull of the prospect for greater fiscal stimulus and ongoing vaccine rollout versus continued lockdowns and the greatest one-month mortality rate since the pandemic began nearly a year ago.
New Year Brings No Respite to Muni Senior Living Sector Turmoil
The coronavirus pushed three dozen municipal-debt issues for senior living communities into default last year and another five have already missed payments in 2021, sowing distress in one of the nation’s safest bond markets.
Demystifying CLO Demand for Leveraged Loans
Collateralized loan obligations are the largest source of demand in the loan market. Cheryl Stober breaks down some key drivers of CLO manager behavior.
ETFs, Message Boards and Volatility
Internet message boards are lighting up and certain stocks have seen some unusually dramatic price moves. David Mann, our Head of Global Exchange Traded Funds (ETFs) Capital Markets, ponders whether ETFs could be subject to similar volatility.
Detached Parabolas and Open Trap Doors
Nothing so animates a speculative herd as a parabolic price advance in an asset detached from any standard of value. I am convinced that future generations will use the present moment to define the concept of a reckless speculative extreme, in the same way our generation uses “1929” and “2000.”
Small Change and The Depression of 1837-1843 - Part Three
The purpose of the Constitutional gold standard was to establish a reference point against which the prices of credits and commodities were set by the open exchange of bank notes and other promises to pay money.
The Fed, Zombies, & The Pathway To Japanification
The Fed recognizes their ongoing monetary interventions have created financial risks in terms of asset bubbles. They are also aware that most policy tools are likely ineffective at mitigating financial risks in the future. Such leaves them being dependent on expanding their balance sheet as their primary weapon.
Springtime for Gamestop
The rationale behind the meteoric rise of Gamestop, a chain of videogame rental stores, and AMC, one of the nation’s largest cinema operators, is too unlikely to be believed. In just one month both stocks had risen by more than 600%.
Yellen, Small Business Owners Discuss Pandemic: Stimulus Update
Treasury Secretary Janet Yellen met with small business owners on Thursday. Senate Republicans criticized moves by Democrats to fast-track President Joe Biden’s $1.9 trillion Covid-19 relief plan without their backing.
Considering Bank Loans? Three Key Considerations
Bank loans offer some of the highest yields in the current interest rate environment. We believe their unique characteristics may prevent many investors from considering them, but it may be a mistake to overlook them.
2021 Outlook: Three Questions for the Mortgage and Structured Finance Sector Team
The Mortgage and Structured Finance Sector Team discusses key themes in the securitized market in 2021.
Welcome to the Jungle
For all Millennial readers, if you visited a casino in your lifetime only to see your money quickly disappear, you have not seen anything compared to trading versus professionals. So to all you Robinhood traders I say, “Welcome to the Jungle.”
A Practical Guide to Behavioral Finance
The future of financial advice is evolving. The real value of an advisor not only requires the ability to build a plan and portfolio, but to guide clients through the process, unearth their values and emotions, and change their behavior for the better. A realm of the relationship is called the human side of money. Here today to talk about that human side and how advisors can leverage the science of behavioral finance is Brendan Frazier.
The Lackluster Record for Infrastructure Investments
Calls for fiscal stimulus measures to target infrastructure are growing. But new research shows that infrastructure investments have offered few benefits to investors.
The Illusion Of Soaring Savings Amid Rising Economic Uncertainty
The illusion of surging savings rates or the decline in the debt-to-income ratios obfuscates the real economic problems and fosters the belief that monetary policies are working. They aren’t.
The Problem With Analysts Forecasts
We can’t predict the future. If we could, fortune tellers would all win the lottery. They don’t, we can’t, and we aren’t going to try. However, this doesn’t stop the annual parade of Wall Street analysts from putting out forecasts on the S&P 500.
How My Clients Are Doubling Their Social Engagement
After working with hundreds of financial professionals to improve their digital presence, I’ve noticed some trends in what is and isn’t working to garner more engagement.
What Advisors Don’t Get About Virtual Selling
Everyone agrees that selling virtually is a whole different thing and most of us feel ill-equipped to do it well.
K2 Advisors First-Quarter Hedge-Fund Strategy Outlook
Our K2 Advisors team is optimistic about the opportunity set in the year ahead, and thinks that active management alpha will be key to success in 2021. Brooks Ritchey and Robert Christian provide the team’s first-quarter hedge-fund strategy outlook.
Here Are the Major Parts of $1.9 Trillion Biden Relief Plan
President-elect Joe Biden’s $1.9 trillion Covid-19 relief plan is designed to both pump money into the economy and contain the coronavirus pandemic.
Market Review Q420: The Trouble With Bubbles
The trouble with bubbles is they prey on human weakness. They are also high impact investment events.
2021 Outlook: Three Questions for the Global Credit Sector Team
Loomis Sayles' Global Credit Sector Team shares their outlook on key themes in the euro credit space.
2021 Outlook: Will Global Credit Be in the Sweet Spot?
Credit markets have staged an epic rebound from the depths of March 2020. But in a low-growth, low-yield world, we believe there may be more room to run in 2021.
On Georgia Elections: Stimulus for Individuals and Infrastructure
The US state of Georgia held January runoff elections that determined two Democrats as their US senators, giving the Democratic Party control of the legislative and executive branches through 2022.
2021 Outlook: Three Questions for the Emerging Markets Debt Sector Team
The Loomis Sayles Emerging Markets Debt Sector Team shares their views on corporate spreads, foreign exchange and leverage in 2021.
Something of Value
The dichotomy of “value” and “growth” investing has become a sharp stylistic divide. But is it helpful? Howard Marks writes in his latest memo how he views the art and science of value investing, especially in the increasingly efficient and complex world we face today.
The Fed Is Juicing Stocks
The Fed juices the stock market in four ways.
Technology’s Rising Importance in Emerging Markets
Whereas commodity production had been a major economic driver in emerging markets, we think technology is now the leading force. Semiconductor advancement is the “new oil.” semiconductor companies are so far ahead of their competitors that supply is in fact a constraint—and therefore a major investment consideration.
Yes, Virginia. There Is A Stock Market Bubble.
As we enter 2021, there are two myths told to investors to support the bull market narrative. The first, as we debunked recently, is that low-interest rates justify high valuations. The second is that since valuations are not as high as the “dot.com” crisis, there is no “stock market bubble.”
2021 Outlook: Three Questions on Emerging Market Equities
Ashish Chugh discusses his outlook on EM equities in 2021.
December 2020 Strategy Letter - Soufflés and Sledgehammers
As we have noted previously, one cannot practically ignore the celebration regarding our annual lap around the sun, although I think it’s fair to say that there are roughly 7.5 billion people outside of Silicon Valley—or those who run large cap growth/tech funds—that are delighted to see 2020 declared over.
Dark Before The Dawn
Policymakers around the world share the challenges of containing the renewed outbreak and supporting those affected by it.
J O Hambro Capital Management 2021 Outlook - Better Times Ahead?
Free from a house view on economies, markets or stocks, J O Hambro Capital Management’s (JOHCM) fund managers invariably see the world in different ways. We asked a number of our managers for their thoughts on the outlook for their asset class next year, what they would like to see and the possible surprises that 2021 could bring.
2021 IG Outlook: Despite Headwinds, a Path Forward Exists
As the new year begins, the investment grade (IG) market faces multiple challenges, including a recovering economy, low yields, tight spreads, and record high duration. At the same time, market technicals remain favorable, fundamentals are improving, and there are attractive sectors in the index. Overall, we are modestly bullish about 2021 and feel there are compelling opportunities for those who know where to look.
World Economy Faces Debt Doom Loop, More Inequity Post Pandemic
The world economy will be exiting the pandemic weighed down by much bigger debts and increased inequality that could hobble growth in the longer term.
Navigating the Sea of Mediocre ESG Fund Performance
The performance of ESG funds has been unimpressive, according to new research, and the occasional outperformance is driven mainly by funds’ expenses, exposures to certain industries and factors.
For Insurers, Time to Take a Broader View of Securitized Investing
Insurers generally take a narrow approach to investing in the securitized sector, usually through allocations in their investment grade fixed income reserve portfolios.
Why There Is Literally No “Cash On The Sidelines.”
In the current bull market advance, few people are willing to sell, so buyers must keep bidding up prices to attract a seller to make a transaction. As long as this remains the case, and exuberance exceeds logic, buyers will continue to pay higher prices to get into the positions they want to own.
Global Investment Committee Outlook: Especially buoyant non-US equities
Although some on the committee agreed with the market consensus for a moderate continuation of economic growth and equity markets, the majority agreed with a more positive scenario in which the global economy outperforms market consensus, while equities, especially those outside of the US, rally sharply.
Why The Second Stimulus Won’t Have Much Economic Impact
In October, I discuss how the “2nd Derivative Effect” would mute the impact of future stimulus programs. With the passage of the $900 billion stimulus package, we can update the estimates for the economic impact heading into 2021.
Shades Of 1999 As “Market Mania” Returns In 2020
“Maybe this time is different. Those words, supposedly the most dangerous to utter in the investing realm, came to mind amid the frenzied pops in the highly anticipated initial public offerings recently.” That quote was from Randall Forsyth discussing why the current market mania reminds him of the “Shades of 1999.”
Six Reasons Your 2021 Marketing Plan Will Fail
I rounded up the six key reasons your marketing strategy will fail in 2021 and how to avoid them.
Looking Ahead to 2021
To organize your team and prepare for the year ahead, take your team through the steps.
Destroying Steady Income Streams
There is strong demand for steady income. However, most investment products and strategies fail dismally in this regard.
Looking Back at 2020
From global responses to local lockdowns, we all witnessed dramatic changes in 2020.
The Digital Marketing Practices that Distinguish High-Growth Advisors
Broadridge recently released its second annual financial advisor marketing survey which revealed the contrasts between effective and ineffective marketers, as well as an expected move to digital due to the continued impact of COVID-19. This year’s survey also shed light on the lack of marketing strategy among advisors and in turn, dissatisfaction with marketing ROI.
America’s Zombie Companies Rack Up $2 Trillion of Debt
They were once America’s corporate titans. Beloved household names. Case studies in success.
Shiller: ECY & Justification For Sky-High Stock Prices
There is much to debate about the current level of interest rates and future stock market returns. However, what is clear is the 40-year decline in rates did not mitigate two extremely nasty bear markets since 1998, just as falling rates did not mitigate the crash in 1929 and the subsequent depression.
Don't Wait for Another Wave
With a COVID-19 vaccine rolling out and markets enjoying a post-election relief rally, credit investors may be asking “is there any opportunity left?”
Five Ways to Supercharge Your Clients’ Transition to Independence
Here are five ways you and your team can become more capable and organized around transitioning clients.
Taking a Personalized Approach to Virtual Financial Advice
Here are a few ways to leverage video communication, like Zoom, so that it works to your advantage…
Could Chinese Bond Defaults Benefit Investors in the Long Run?
Recent SOE bond defaults signal Beijing’s willingness to let markets price risk more accurately.
Georgia Runoffs To Decide Direction Of The Country
The two Georgia Senate runoff races on January 5 will be among the most important elections in our lifetimes, whether you are a conservative or a liberal. As a result, enormous and unprecedented amounts of outside money are gushing into these runoffs.
Early Cycle Investing: Navigating the Growth Rebound
We believe traditional fixed income should continue to provide a reliable source of diversification against a growth shock, but low rates and the risk of an inflation shock necessitate broadening the menu of diversifiers.
Key Changes Shaping a New Path for China’s Recovery
Many market participants expect major economies to follow a path to recovery similar to China’s, but we see three key factors that suggest China’s recovery may be on its own trajectory.
The Case for Waste: Finding Growth in Garbage
Although investors don’t normally think about trash when they’re looking for growth stocks, we believe the solid waste industry is well-positioned to outperform. In our view, the combination of high barriers to entry, stable demand, and opportunities for consolidation should provide reliable revenue growth for the foreseeable future.
Why the Breakaway Broker Exodus Hasn’t Happened
This mass exodus of breakaway brokers hasn’t happened, much to the chagrin of us prognosticators, and I know why.
LPL Research Outlook 2021: Powering Forward December 2020
More than most years, it’s hard to look ahead to the next year, to 2021, without looking back at 2020. A global pandemic, a massive economic collapse, a bear market, a surprisingly sharp reversal, a hotly contested election where passions ran high, the impact of lockdowns—it was an unusual year of extraordinary challenges.
The Energy Rally Is Likely Premature
The rally in energy companies is likely premature. To understand why such may be the case, we have to review a bit of history.
Why we are turning bullish for 2021
We highlight the reasons behind our pro-risk stance in our 2021 outlook in the weekly commentary.
Net Present Value Bargains
There appears to be a few huge statistical bargains available in the stock market based on the simplified version of Benjamin Graham’s intrinsic value calculation.
A Small-Cap Value Analyst’s View on US P&C Insurers
Franklin Small Cap Value Fund Assistant Portfolio Manager and Research Analyst Nick Karzon gives five reasons why we continue to see attractive long-term opportunities for select small-capitalization (small-cap) P&C insurers.
The Times Are a Changing
Some changes unfold over time and it’s possible to see them coming. There are demographic changes coming in the next decade that will change the direction of the U.S., since the Silent generation and the Baby Boomers hold a different view of government than Gen Z’s and Millennials.
Are You Using Your CRM to Its Fullest Potential?
Whether you’re looking to dust off your CRM software and learn to better use its features, or you’re looking to make a CRM investment for the first time, here’s what you need to know.