Quarterly Update: Knowledge Leaders Strategy

January 19, 2017
By Knowledge Leaders Team in Economy, Knowledge Leaders, Markets, Portfolio Management

In our new quarterly update report, Portfolio Manager Steven Vannelli, CFA, discusses the investment team’s recent analysis on two topics, including:

1. New portfolio opportunities. Huge innovation in the energy sector – and the US Shale Revolution specifically — has manifested into new portfolio opportunities. The US cost of production of oil has fallen by 50% over the last five years, making the US now among the most competitive oil producers in the world. As a result, North America is expected to be completely energy independent by 2020. Our analysis of intangible-adjusted data reveals an innovation renaissance taking place among many of the resources companies of the Shale Revolution. Steve shares a new Knowledge Leaders Index created to take advantage of this opportunity as well as new and compelling valuations in these resource-heavy sectors.

2. Fixed income defense. We believe that the recent sell-off in bonds is overdone. Over the last months we saw a three-standard deviation move in US long bonds, an event that has occurred only six times in the last 50 years. Steve discusses 12 factors he expects to keep a lid on interest rates.

Download the full report to learn more. If you’d like to join today’s conference call at 4:15pm ET hosted by Steve, please email info@gavekal-usa.com for coordinates.

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