The Capital Growth Channel

Global Vision Enhances Equity Insight

Investors all over the world often prefer to stay in their home markets. But at what cost? Going global can open up a world of choice to help improve a portfolio’s equity risk and return profile.

The Coming Bear Market?

The US stock market today looks a lot like it did at the peak before all 13 previous price collapses. That doesn't mean that a bear market is imminent, but it does amount to a stark warning against complacency.

High Yield Market Update

The U.S. high yield bond market has grown substantially to around $1.3 trillion today. At the same time, the global high yield market has become more geographically diverse. North America’s share of the market has fallen from 87.1% in 2005 to 62.6% in 2016.

Emerging Markets in the Digital Age

My colleagues and I have been actively speaking about the evolution taking place in many emerging markets over the past few decades. We’ve seen dramatic shifts occurring, with the often one-dimensional economic models of the past giving way to new and diverse growth drivers.

Myths and Misconceptions

History shows, and investment strategists tout, that small cap stocks are the best performing asset class. While small caps outperformed the runner-up, large cap stocks, over the last nearly 100 years, research has shown that the outperformance hasn’t persisted over all multi-year time periods and that the outperformance is concentrated in microcap stocks.

Fed Resists the Doves

The big news today wasn't the Federal Reserve's decision to start gradually reducing its balance sheet in October. Almost everyone expected that. Instead, the big news was that twelve of the sixteen members of the Fed's interest-rate setting body – the Federal Open Market Committee – think the Fed will be raising interest rates by at least 25 basis points later this year.

Conference Board Leading Economic Index: Continued Increases in August

The latest Conference Board Leading Economic Index (LEI) for August increased to 128.8 from 128.3 in July and is currently at another all-time high.

Investing In EV Carmakers and Supply Chains? Utility Work Ahead

Future growth projections for electric vehicles vary dramatically, but all reflect real opportunities for fundamentals-focused investors surveying the links in supply and production chains.

Large-Cap Value Farming

Value investing is very similar to farming. A farmer needs fertile ground, well-planted seeds, unshakable patience, loads of sunshine, watering and weeding, as well as a great deal of courage and faith to succeed in the long run. Today, we believe that investors need to reexamine the benefits of a value investing approach toward the end of an era which has rewarded growth stock investing.

How to Trade in Today’s Placid Bond Markets

Today’s low bond market volatility won’t last forever. But knowing whether a correction will come next week or next year isn’t so important. Having an efficient trading strategy that can execute in both tranquil and turbulent markets is.

The German Election and Markets

What might the German election mean for markets?

U.S. Debt Tops $20 Trillion - Stocks Soar To Record Highs

We touch on several bases in today’s letter that are not entirely related. We begin with the 800-pound gorilla in the room – the fact that the US national debt topped $20 trillion last week.

Are Diversifying Assets Up Next in the Return-Seeking Cycle?

After a sustained period of return leadership by U.S. stocks, a number of diversifying assets now appear poised for outperformance.

North Korea: An Update

North Korea has become increasingly belligerent, launching ballistic missiles, testing a hydrogen device and claiming to have miniaturized a warhead; if true, this means it is a nuclear power. Although Trump says “all options are on the table,” a full-scale war would be catastrophic and may be impossible to contain.

Time to Take a (Measured) Risk?

Astute investors know that buying when others are fearful can be a good strategy. Despite remarkably low market volatility, investors continue to avoid risk. This month, we examine previous periods of risk and investor behavior, when investors discarded normal valuation measures, threw caution to the wind, and suffered the consequences.