With sky-high valuations in the US stock market, and what we believe is a tech bubble that has dangerous implications for other areas of the market, we suggest four actions investors can take now to avoid the inevitable bursting of the bubble, and which will likely benefit their portfolios’ long-term performance potential.
Technology companies are known for innovation, and it doesn’t take long for a revolutionary new technology to take hold and become a part of people’s daily lives. In my view, investors shouldn’t be threatened by technology. Rather, they should be skeptical of companies not utilizing technology to its fullest potential.
It’s been a rocky start to 2018 for equity markets globally—volatility has returned with a bang and February saw the first 10% market correction in a while. So, why are active managers smiling?
The tax efficiency of the Value factor can be improved by reducing exposure to dividend-yielding stocks. Improving the tax efficiency reduces the performance in Europe and Japan, but not in the US. Reducing turnover can be considered for minimising capital gains and stamp duty taxes.
Rising rates are adding new risks to equity markets. Stocks of companies that are saddled with debt have underperformed recently. And leverage is especially high in sectors widely seen as safe havens.
Many investors who thought worrying about inflation was “so 20th century” may now be seeing reasons to reconsider: The business cycle in the U.S. is mature, output gaps have closed, trade frictions are mounting and populism is on the rise.
Advisor Perspectives, a leading publisher serving financial advisors and the financial advisory community, has announced its Venerated Voices™ awards for commentaries published in Q1 2018. Rankings were issued in three categories: The Top 25 Venerated Voices™ by Firm, The Top 25 Venerated Voices™ by Author and The Top 10 Venerated Voices™ by Commentary.
Equities experienced heightened volatility during the first quarter of 2018, with the S&P 500 Index surging 7.55% from Dec. 31 2017, through Jan. 26, 2018, before dropping nearly 8% through quarter-end.
So-called “smart-beta” strategies hasn’t been all that smart lately – at least not for the last five years. This article will examine why, whether it was predictable and the likelihood it will work better going forward.
The evaluation of alternatives introduces an extra dimension into the equation that investors don’t need to think about with traditional equity funds. It’s the concept of capital efficiency.