During this period of economic uncertainty and market stress, investors may be surprised to discover how a strategy targeting stocks that lose less in a downturn can beat the market over time.
Equity investors are anxious about the future after sharp market declines in the first half of 2022.
Three powerful forces have unleashed a volatility storm in stock markets this year.
Equity markets were jolted in January amid growing concerns about macroeconomic threats.
Equity investors focused on a low-carbon strategy needn’t compromise on company fundamentals. When quality and compelling valuations are equally considered, joining the global fight against climate change and generating strong return potential can work hand in glove.
Defensive stocks are often misunderstood. In recent years, even when they have delivered strong and steady earnings, returns have disappointed.
Across the industrial sector, low-carbon investing naturally leans toward renewable energy opportunities, like wind and solar power.
The exit from the pandemic will be bumpy. Defensive stocks with attractive valuations can help provide balance through an uncertain recovery.
Global stocks rebounded sharply from the coronavirus market crash in 2020, but the ride was rocky. With so many risks clouding the outlook, we believe that investors should focus on generating a smoother pattern of returns through the recovery from COVID-19.
Defensive equities are usually found in sectors that have withstood market shocks, such as utilities and real estate. But as COVID-19 shakes up investment conventions, companies with intangible assets are being more appreciated for their volatility cushion.
Several equity factors diverged significantly from their typical performance patterns during the COVID-19 crisis. By understanding how factor returns behaved in this market correction relative to their historic norms, investors can not only prepare for future volatility but also take advantage of short-term market dislocations.
Following these guidelines can help equity investors navigate the uncertainty created by the COVID-19 pandemic when selecting stocks and positioning portfolios.
Even as global stocks climbed in 2019, market volatility persisted. By some measures, lower-volatility stocks now look quite expensive. But in fact, high-quality stocks that can help protect portfolios can be found at reasonable prices, if you know where to look.
Rejoice—people around the world are living longer! But pause the festivities—that means they need more retirement money. To ensure they don’t run out of cash, savers need to adjust their investment strategies as their needs change, both before and after retiring.
Global stocks rebounded in the first quarter, but the ride was rocky. Even in a rising market, volatility is a clear and present danger. With so many risks clouding the outlook, we believe that investors should focus on generating a smoother pattern of returns.
Recent volatility reminds us that new risks are testing standard defensive equity strategies. Portfolios that offer downside protection need to go beyond standard risk models and position themselves for changing challenges ranging from trade wars to European political instability.
From nuclear tensions with North Korea to turmoil on the streets of Charlottesville, political risks have been hovering over equity markets again. We think investors should be on alert for a potential resurgence of volatility.
Disruptive forces are wreaking havoc across the global business world. But not all disruption is fatal. Lots of companies are facing the threat—and thriving. We think they deserve more credit than investors are giving them.
Stable stocks are out. Riskier reflation plays are in. But who knows which way fickle market winds will blow tomorrow? That’s why strategies that harness stability and good judgement never go out of style.
