Emerging Market (EM) equities have had all sorts of trouble so far in 2015. For US dollar based investors, weakening EM currencies coupled with falling stocks in local currency terms has led the preeminent emerging market stocks index – the MSCI Emerging Markets Index – to be down roughly 17% from its recent high. As […]
We all read about it in the news, but ETFs really are becoming the preferred investment vehicle for the investing public. The evidence is clear; both in terms of number of funds and net assets ETF growth is outpacing mutual fund growth by a wide margin. The first chart below shows the number of bond […]
Japan has been the forgotten equity market this year despite the impressive gains seen year to date. Indeed, on an equal weighted basis and in USD terms Japan is the best performing country in the developed markets as table 1 shows. It’s also the best performing major market by a mile with France coming in […]
ETF Trends reported the other day that total ETF assets under management are expected to double by 2020, translating into roughly $740 billion per year of flows into ETFs (link to story here). If we look at just equity related ETFs, the growth dynamic is easy to see. All categories of equity ETFs have seen […]
For the last five years the European technology sector has been locked in a trading range relative to the MSCI All Country World Index (USD). Recently, however, European technology stocks have been performing quite well. On an equal weighted basis, they have been the second best performing group in Europe year-to-date. While there are only 17 […]
Health care stocks have been the leadership sector in the MSCI World, and many (such as biotech) have reached some pretty elevated valuations. Most stocks in the sector have been in multi-year bull markets trends, outperforming the MSCI All Country World Index significantly. In our relative strength point and figure charts we take the daily […]
Profitability and investment are inextricably linked through time. A company’s investment decisions today will ultimately drive its profitability level tomorrow. The fruits of a company’s investment decisions eventually show up in profitability metrics such as free cash flow margin, operating cash flow margin, and return on equity. Finally. a company’s ability to improve these metrics, […]
After our recent call, we received an insightful question about how we view research and development (R&D) because surely not all R&D is productive and profitable?
Market-cap weighted indexes such as the MSCI global equity indexes are commonly used reference points for investment benchmarking. In these indexes, the market cap of the top 10% of the stocks is generally 50% of the market cap of the index.
I often go back and re-read things that have shaped my perspective on managing portfolios. In my 20s (in the 1990s) I was fortunate to have a friend and mentor named Clay Allen who taught me volumes on the art of portfolio management.