We have always liked the clip from the movie Animal House where in the “Deltas on Trial” scene the smooth talking Eric “Otter” Stratton get up and says, “Point of parliamentary procedure.” From there Otter goes on a diatribe ending with the comment, “Isn’t this an indictment of our entire American society?
John Stoltzfus, chief investment strategist at Oppenheimer Asset Management, explains his top-down view of markets, the economy and asset allocation.
How we’re positioning muni portfolios for turbulence – and the opportunities it may create.
When you write about economics, you learn very quickly that the economy doesn’t care what you say about it. The forces that drive it are beyond any one person’s comprehension, much less control. But at the same time, the economy doesn’t work like a law of nature. Unlike gravity, for instance, the economy responds to human choices and preferences. We influence it, even if we don’t understand exactly how.
In the latest edition of “Global Macro Shifts,” the Templeton Global Macro team examines the plans to start shrinking the US Federal Reserve’s (Fed’s) balance sheet and the potential impacts to financial markets.
Economic dislocations, regulatory shifts or intense competition can change the market dynamics confronting big, and at times unwieldy, conglomerates. They often force corporate restructurings that can result in more effective capital allocation and returns for investors who recognize promising new strategies amid the prevailing market pressures.
Global CIO Jeff Hussey discusses why we believe having a clear view of your portfolio—with detailed, real-time knowledge down to the street level—is essential in today's market environment.
So I am sittin’ on a dock of the bay here in Boca Raton Florida watchin’ the tide roll away as I wait to speak at a conference of insurance CEOs and CFOs. I have spoken at this annual event for the past 10 years, and it is always a “gas” because the attendees are terrific people.
At least for tax-advantaged investors, dividends are irrelevant: They are neither good nor bad in terms of forward-looking return expectations. Therefore, while there is no reason to exclude dividend-paying stocks, focusing solely on them leads to less diversified (less efficient) portfolios.
In its most concerted effort to reverse slowing credit and economic growth to date, New Delhi devises a $32 billion public sector bank recapitalization.
By definition, mutual fund star-rating systems focus on past performance—not future results. We believe that the key to identifying potential outperformers lies in extensive manager research—and that's what we do.
The narrative about the Fed's policy has shifted over time as equities have risen. As late as 2012, QE was viewed as bearish. Into 2014, it was only continued QE inflows that were considered bullish. When stocks kept rising after QE ended, the narrative shifted to the large Fed "balance sheet" and then to global central bank actions.
We have used the aforementioned quote many times over our nearly 50 years in this business, but surprisingly, it is just as relevant now as it was when first written. Bet it surprised you that the quote is dated 1935! Read it a few times away from the maddening crowd and reflect on it, because certain phrases will grab you with their wisdom.
Global and domestic economic growth, along with a solid earnings picture and a potential tax reform tailwind, suggest investors should remain at their target equity allocations. Pullbacks are possible but a recession doesn’t appear to be in the cards in the near term, which historically has meant the risk of a pullback turning into a bear market is low.
Unprecedented changes are reshaping the financial advice industry and affecting portfolio construction for individual investors. New regulation, technological innovation, capital market trends and the prospect of lower future returns are all exerting profound effects.
Money is a vital life enhancer. If you have it, you can enjoy life incomparably more than if you don’t. The great storehouses of travel, leisure, rest, refinement, appearance, health, above all, peace of mind – all of these are open to you if you have money.
Zhou Xiaochuan appeared to be talking about China, given his contextual warnings about the country’s high corporate and rising household debt loads. But the message may apply to frothy and debt-laden markets globally.
Low market correlations make it easier for active portfolio managers to stand out—positively or negatively. But what matters most is how a portfolio of select stocks performs through market cycles, regardless of correlations.
Momentum is one of the most compelling factors in theoretical long–short paper portfolios, but live results of momentum strategies fall short of theoretical returns. Thoughtful implementation, a careful sell discipline, and an avoidance of stocks with stale momentum can narrow the gap between paper and live results.
I first became aware of Frederick “Shad” Rowe, captain of Dallas-based Greenbrier Partners, by reading his brilliant comments in Forbes magazine decades ago. While Shade no longer writes for Forbes, his stock market insights are available via his monthly letter to the clients in his investment partnership.
Shakes off bad news and listens to good news! That’s how the past two weeks have been since the “melt up” began.
K2 Advisors seeks to add value through active portfolio management, tactical allocation and diversification across four main hedge strategies: long/short equity, relative value, global macro and event driven. In their fourth-quarter (Q4) 2017 outlook, K2 Advisors’ Research and Portfolio Construction teams share the key market events they have an eye on.
India has implemented measures that combined should generate a surge in economic growth, corporate earnings, and double-digit annualized stock returns over the next decade.
For 23 years DALBAR, Inc. has been publishing a research report reaching the conclusion, year after year, that investors underperform the investment vehicles that they invest in due to “poor investor decision making.” Wade Pfau recently discovered, however, that this conclusion is the result of a serious calculation error. Now, using Pfau’s results, I will prove that the evidence actually shows that investors do not underperform their investments.
I don’t think for a second that cryptocurrencies will ever replace gold, for a number of reasons. For one, cryptos are strictly forms of currency, whereas gold has many other time-tested applications, from jewelry to dentistry to electronics.
Fed’s balance sheet unwind comes amid mixed U.S. data, but the global acceleration in growth and inflation gives it cover to continue normalizing policy and reduce market distortions. The upswing might also give pause to those asserting the death of the Phillips Curve.
We recalled these sage words from GMO’s (Grantham, Mayo & Van Otterloo) Jeremy Grantham as we watched the end of the quarter performance gaming and portfolio restructuring late last week. His comments are particularly cogent now that we have entered the month of October, since many money management firms close their fiscal year “books” at the end of this month.
This article will tackle the “p-hacking” issue and propose a framework to help those who embrace evidence-based investing to make judicious decisions based on a more thoughtful interpretation of finance research.
The major US indices traded at new all-time highs (ATH) again this week, led by surging small cap stocks. SPX is now higher 6 months in a row and 10 of the past 11 months; that level of momentum has never marked a bull market high. Short-term optimism has reached an extreme that has resulted in a lower weekly close within the next 6 weeks every time over the past 5 years. The fundamental narrative for the current rally is that the Trump administration's tax plan will boost earnings by an estimated 6%. If investors expect the tax plan to also cause economic growth to accelerate, they are very likely to be disappointed.
Versatile, relative-value analysis of securities across sub-sectors and hybrid asset classes can help fixed income teams negotiate a challenging, expansive, potentially rewarding terrain.
In Passive Carnage Is Illogical, we discuss what is driving the passive rotation, as well as how strategies and products have evolved to suit investors’ changing needs.. We also consider the importance of three disruptors in asset management that are having a remarkable influence, including: Separately Managed Accounts (SMAs), Robo-advisors (Robos), and Exchange Traded Funds (ETFs).
The steady bull market—now the second largest—continues. The Dow just had its third nine-day win streak of 2017, which hasn’t happened within a single year since 1955. Can the rally continue? While longer-term technicals do look very healthy, a closer look suggests that it has been a historically long time since even a modest correction, thus increasing the chances of a rise in volatility soon.
Engineers (like all other groups) have well-defined personality traits. If you want to convert them, you need to understand what makes them tick.
In case you missed it, on September 7, APViewpoint hosted one of the best debates ever regarding the fiduciary standard and the DOL rule. It was notable because unlike most of what you’ve been reading, it covered both sides of the topic, and the debaters forced each other to provide deeper rationales for their beliefs. Here are my key insights, particularly those that illustrate the thinking behind the anti-fiduciary mindset.
Stocks have bucked all manner of fierce storms—figurative and literal—and optimism (and possibly risk) has risen as a result.
Starting conditions matter. Today’s investment yields impact future realized returns. But many still rely on past returns to estimate future returns. Our online Asset Allocation Interactive tool gives you the information you need to look ahead, not just back.
“Managing risk,” what a novel concept, but regrettably many investors fail to do just that. My father taught me to manage risk, a trait emphasized in the sentinel book by Benjamin Graham, The Intelligent Investor, which Warren Buffett has deemed, “The best book ever written on investing” and where the aforementioned quote resides.
Several years ago, I began writing an annual update discussing Dalbar’s Quantitative Analysis Of Investor Behavior study. The study showed just how poorly investors perform relative to market benchmarks over time and the reasons for that underperformance.
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.
Reflecting on the months of travel as we wing our way back to Tampa at 38,000 feet, one of the more interesting encounters in those travels was spending time with Steve Forbes (Forbes Magazine). Although Steve is a staunch Republican, he suggested that Republicans worship at the altar of the CBO (Congressional Budget Office).
A review of last month’s market-moving events across countries and asset classes.
So, I am sitting here in downtown Saint Petersburg, Florida at 7:30 a.m. Sunday morning awaiting the “great flood.” It was just a few days ago the computer models had hurricane Irma heading up the east coast of Florida, but Irma changed her mind.
Frothy stocks and well bid bonds can undercut portfolio performance if rates move higher, though long/short equity strategies can support long-run returns.
Over three years $1.4 trillion moved into low-fee funds including ETFs, which are quickly becoming the most popular of 18 major vehicles. The complexity of launching an ETF and their operational overhead has kept many firms from launching funds. New programs now help firms launch and manage ETFs.
There’s an ongoing narrative about the energy industry that says exploration and production (E&P) companies are making money in unconventional shale plays, even with oil selling for only $50 a barrel. This is touted as a positive trend. But a deeper dive into energy company fundamentals suggests a vastly different story — one that prioritizes production volume over economic value.
This letter will be the first of a series in which I outline my vision for the next 5–10–15–20 years of global economics. I understand that there is a substantial amount of hubris involved in such an undertaking, so I will approach the topic gingerly.
China put a halt to new ICOs and crypto transactions. In response, ethereum tumbled as much as 15.8 percent on Monday, or $55 a unit. Bitcoin lost $394 a unit.
Our approach to investing in long duration and long credit portfolios has delivered meaningful alpha over most market cycles.
The best call financial writer Geoffrey Caveney ever made was in December 2015. Gold hit a multiyear low of $1,050 an ounce, and he was convinced that the metal had found a bottom. It was time to make a trade, he thought, not just in bullion but precious metal miners, specifically the juniors and some micro-cap names.
