Eighty-one years later…

Harbouring year-end reviews and final accounts, the last weeks of December are infused with nostalgia. In this seasonal spirit, I’d like to draw your attention to an under-celebrated piece of work, completed in the year that Katharine Hepburn, Cary Grant and Shirley Temple saw their debuts on the silver screen. In 1932, Fred had not Read more […]

The year in balance

The US stock market did very well in 2013, up 25% (before dividends) through December 16th, with better results than the overall economy and most other developed markets.  The one big exception is Japan where the market is up almost 47% in Yen terms, though within a percentage point of the S&P 500 when measured Read more […]

The Persistence of Non-Persistence

The phrase “past performance is not a guarantee of future results” has never rung more true for active mutual funds. Our semi-annual publication, the Persistence Scorecard, takes a look at the performance of top quartile active funds over three- and five-year consecutive 12-month periods. Based on the most recently released report, out of 265 large Read more […]

Taking Risk and Making Money

My colleagues, Daniel Ung and Xiaowei Kang, recently published an article on alternative commodity strategies. Below is an intro and some highlights: “Ever since the publication of Professor Harry Markowitz’s work in 1952, modern portfolio theory has been one of the cornerstones of asset allocation and portfolio construction. Until recently, the principal building blocks used to Read more […]

Indexing Beyond Large-caps: What happens to top performing funds?

At S&P Dow Jones Indices, our research indicates that indexing small-cap and mid-cap stocks works as well as it does for large-cap stocks, even though the large-cap segment may be more efficient than its junior siblings. Nevertheless, the popular belief that indexing works better for large-caps is well-entrenched and widely endorsed by advisors, consultants, and Read more […]

Healthcare growth drivers for the large employer market

An article published Friday in Healthcare Payer News, “How health inflation could slow, or rise, in 2014” indicates a projected 6.5% increase in the large employer medical inflation for 2014 by PWC Health. As can be seen by the S&P Healthcare Claims Indices, an index series comprised of claims data provided by leading insurers in Read more […]

Plot Thickens for Puerto Rico Bonds

The story plot thickens for Puerto Rico bonds as Moody’s placed bonds issued from Puerto Rico under review for a possible downgrade to below investment grade.  Selling pressure continues to mount impacting the market.  The S&P Municipal Bond Puerto Rico Index has seen a negative total return of 19.45% year to date and the weighted Read more […]

Volquakes

Volatility can feel like an earthquake. As many investors can painfully testify, the chart below is typical of volatility.  A period of relative calm is disturbed first by a few small tremors, then by a precipitous rise.  At this point, risk breaks all connections with its normal level and climbs rapidly to a crystalized zenith Read more […]

Facebook and the S&P 500

On December 11th, after the market closed, S&P Dow Jones Indices announced that Facebook will  join the S&P 500 as of the market open on Monday, December 23rd.   This was probably one of most predicted, asked about and commented on additions to the S&P 500 in the last few years, Measured by the number of Read more […]

Australian Corporate Bonds Outperformed the Market

Tracked by the S&P/ASX Corporate Bond Index, the size of the Australian dollar denominated corporate bond market currently stands at 57 billion, which is one-tenth of the broader benchmark, the S&P/ASX Australian Fixed Interest Index. While the corporate sector is relatively small in Australian bond market, the size actually grew more than 80% since the Read more […]