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May 16, 2022

A Practical Look at Index Liquidity in Asia

What role does index liquidity play in helping market-participants in Asia participate in the U.S. equity ecosystem during Asia’s trading hours? Join S&P DJI and State Street Global Advisors for a practical look at using indices to assess the potential opportunity set. Learn more: Regional Relevancy of S&P 500 and Dow Jones Industrial Average Futures…

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May 12, 2022

S&P 500 Weekly Options Now Expire Five Days a Week

Since their debut in 1983, S&P 500 options have grown into the most liquid index options in the market today.1 In 2005, Cboe introduced PM-settled S&P 500 weekly options (SPXW) to meet market demand for additional trading frequency. The first weekly options expired only on Fridays, with Monday and Wednesday expirations added over time. On…

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May 10, 2022

Transparency, Independence and Integrity as the Bedrocks of Indexing

I am deeply honored to assume the chairmanship of the Index Industry Association (IIA) this year. Since 2012, the IIA has been a tireless advocate for independent index providers globally. As the IIA celebrates its 10th anniversary this year, now more than ever, our role in educating people about how indexing has transformed and democratized…

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May 9, 2022

Value Resurgent, Part 2

The years between 2017 and 2021 were a frustrating half-decade for value investors. The S&P 500 Growth Index advanced at a compound annual rate of 24.1%, more than double the 11.9% return of its Value counterpart. Despite occasional (and sometimes prematurely celebrated) periods of success, Value underperformed Growth in four years of the five (and…

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Apr 26, 2022

Growth Managers’ Perfect Storm

Anyone familiar with our SPIVA reports will realize that most active managers fail most of the time. In 21 years of SPIVA data, a majority of large-cap managers underperformed the S&P 500 18 times; the most recent of the three exceptions came in 2009. Even in that context, 2021 was a year of above-average difficulty,…

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Mar 18, 2022

The Odds Are Against You

S&P Dow Jones Indices’ SPIVA (S&P Index Versus Active) scorecard, first published in 2002, has become our industry’s de facto scorekeeper of the relative performance of active managers. We recently released the U.S. SPIVA results for 2021. Nothing in the 2021 report was surprising, as most active managers continued to underperform benchmarks appropriate to their…

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Mar 18, 2022

Rising Rate Reflections

The Federal Open Market Committee voted to raise the Federal Funds rate by 25 bps on March 16, 2022. This move was well telegraphed and not at all surprising—but that doesn’t mean that we won’t hear concerns about how rising rates will impact equity returns. Finance theory teaches us that, other things equal, rising interest…

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Mar 14, 2022

Contemplating Concentration

After the exceptional performance of large-cap stocks in recent years, concentration concerns naturally come to mind. There are many ways to measure concentration. A simple method is to add up the weight of the top names, but the drawback with this approach is it doesn’t incorporate all the constituents in an index. The Herfindahl-Hirschman Index…

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Mar 11, 2022

Style Perspectives In Vogue

U.S. equities have had a tough start to the year amid rising inflation concerns, anticipated rate hikes by the Federal Reserve, earnings misses from several mega-cap companies, and ongoing geopolitical tensions emanating from the Russia-Ukraine conflict. Exhibit 1 shows that the S&P 500®, S&P MidCap 400®, and S&P SmallCap 600® all declined in the first…

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Mar 8, 2022

No Easy Answer: Sector and Factor Responses to U.S. Rate Hikes

Although higher rates are generally seen as negative for risk assets, the initial stages of a monetary tightening cycle have not been disastrous for the U.S. stock market historically. However, while the overall market may muddle through just fine, the same may not be true for the different sectors and factors that compose a broad…

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