Green Bond Update for May 2017

Green bond Issuance picked up in the first two weeks in May compared with the previous two-week period.  Twenty new green labeled bond offerings were announced, including 11 U.S. municipal offerings with maturity structure (215 unique instruments).  Issuance totaled USD 7.56 billion, of which USD 2.4 billion was in U.S. municipal bonds.  Of note, German Read more […]

The Wind Bloweth Where It Listeth…

In the latest quarterly rebalance (effective at market close on May 19, 2017), the S&P 500 Low Volatility Index added more weight from the technology sector. The jump from 7% to 12% is the largest increase for any sector. Meanwhile, the index continued to shed weight in Consumer Staples and Utilities, historically the stalwarts of Read more […]

100 Days Later in Mexico

100 days…is it a milestone?  Is it a key number?  I’m not sure, but everybody looks like they love to write about it, so I will too.  What I know is in Mexico we have a saying that goes, “If the U.S. sneezes, Mexico gets a cold.”  Following Dennis Badlyans’s post “Does the Outperformance of Read more […]

Debt Rising

Outstanding household debt reached a new high in the 2017 first quarter, surpassing the level set in the 2008 third quarter when Lehman Brothers failed and the financial crisis arose. Despite worrisome comments in the press, there is no cause for concern.  First, default rates on mortgages, auto loans and revolving credit are as low Read more […]

Three Takeaways From the SPIVA U.S. Year-End 2016 Scorecard

S&P Dow Jones has been reporting the SPIVA® U.S. Scorecard for 15 years now.  Over the years, it has helped contribute to the active versus passive debate in a systematic and objective manner.  While some market segments or styles of active management can be cyclical in their ability to outperform, the secular trends in reported Read more […]

Regime Change? Not according to the VIX term structure…

Since the U.S. election, a degree of optimism over potential business-friendly legislation – ranging from tax reform to infrastructure spending – has played a significant part in sending benchmarks such as the S&P 500 to new all-time highs.  Whether this optimism will be justified by actual legislation, of course, is a different issue. At a minimum, recent Read more […]

MidCap: A Sweet Spot in the Indian Equity Market

The mid-cap space has often been described as the “sweet spot” of equity investing—and with good reason.  Mid-cap companies tend to offer a balance between the high growth (and high risk) offered by small caps and the stability (but relatively slower growth) of large caps.  Additionally, Indian mid-caps have a more diverse sector representation than Read more […]

Ingredients in a Multi-Factor Recipe

In our previous blog on multi-factor merits, we discussed the diversification benefits of combining equity factors.  We highlighted how multi-factor indices may generate more stable excess returns, while avoiding the risks inherent in timing factors.  But to achieve this, can market participants just throw lots of factors into a pot and hope for the best? Read more […]

Cheap for a reason? Beware the value trap

What is a value trap? While value can be an appealing investment strategy, identifying value opportunities is not as easy as it might appear. One of the drawbacks of value investing is the so-called “value trap.” A value trap occurs when a stock appears cheap, but is trading at low multiples due to underlying problems Read more […]

Multiple Paths to Multiple Factor Indexing

Single factor “smart beta” indicized strategies that were once exclusive to the realm of active management.   Multifactor indexing is beginning to garner much interest as the newest chapter of index innovation. It’s a natural conjecture that if single factors are successful, combining more than one factor should prove even more beneficial.   While any combination of Read more […]