Base Metals Beat Precious Metals By Most In 26 Years

November was sandwiched between two eventful surprises, starting with the election and ending with OPEC’s agreement to cut output, that resulted in a month filled with big moves, mostly positive.  The Dow Jones Commodity Index (DJCI) Total Return for the month was 2.3%, bringing its year-to-date (YTD) total return to 11.8%.  The S&P GSCI Total Return Read more […]

The Turning Point

Thirty-five years ago on September 30, 1981 the 10 Year treasury yield peaked at 15.85%.  With a few bumps it has slid downward ever since – until now. The events of the last few weeks moved interest rates higher and added about 25 bp to the ten year treasury.  Even allowing for some near-term volatility Read more […]

Rising Rates and Inflation: Implications for Equities

Even a cursory glance at financial markets indicates that market participants are expecting some form of interest rate increase in the near future—there has been a sell-off in the 10-Year U.S. Treasury Bond market, and certain sectors that are expected to benefit from such a rate increase have gained.  For instance, the S&P 500 Financials Read more […]

Why Cutting OPEC Supply From Highest to Higher Still Hurts

After OPEC agreed to an oil output cut in Algiers on Sep. 29, they increased supply by 230 kb/d to a record 33.83 mb/d in October according to the International Energy Agency (IEA).  Supply from Iraq reached the highest level ever and Iran pushed flows to a pre-sanctions rate of 3.72 mb/d. Now OPEC supply has Read more […]

Why MSCI and S&P Dow Jones Indices Began Working Together in One Important Way

MSCI and S&P Dow Jones Indices respect each other, as good rivals should, but we often disagree. We see South Korea as a developed market and MSCI classifies it as emerging; we have 500 companies represented in our leading US index and MSCI has 295; we have our own free float methodology and they have Read more […]

The Green-Eyed [Bond] Monster

Green bonds are bonds created to fund projects with positive outcomes that are directly related to the environment. They include the following. “Use of proceeds” bonds and revenue bonds, which are designated for green projects. Green project bonds, the proceeds of which are earmarked for specific projects with positive environmental outcomes. Green securitized bonds, which Read more […]

SPIVA® South Africa: Active Equity Funds Followed the Global Trend—They Underperformed

South African equity markets have once again performed poorly, especially in comparison with global equity markets.  One reason for this drab performance was that its GDP contracted 1.2% in the first quarter, although the price of gold—one of the country’s key exports—increased and the South African rand recovered somewhat with respect to other currencies. Poor Read more […]

Back to Normal…Almost

It’s been a roller coaster week in the aftermath of the startling conclusion to the U.S. Presidential election on November 8, 2016.   As recently as a week before the election, equity markets were quite calm, although volatility levels recognized the possibility of a surprise Trump victory.  When that victory occurred, U.S. futures declined significantly before Read more […]

India: Market Update for Q3 2016

Buoyed by a good monsoon season, an increased inflow of funds by foreign portfolio investors (FPIs), the passage of a goods and services tax (GST) bill in the upper as well as lower house, and the possibility of an interest rate cut due to low to moderate inflation, the Indian capital market posted its second-best Read more […]

Water and Financial Returns—Don’t Be Hung Out to Dry

Recently, investment professionals have paid increasing attention to the impact of carbon-intensive businesses on financial returns.  Stricter regulation and increased certainty of higher carbon pricing have made this a mainstream concern.  S&P Global Ratings’ announcement of a green assessment of debt finance in September 2016 is one notable example of this trend. Water scarcity, as Read more […]