Tag Archives: 2022
What Performance Reversals Suggest
Investment results in 2022 were distinctly different from those of the recent past. The S&P 500®, which had doubled in the three years between 2019 and 2021, fell by more than 18% last year, and Exhibit 1 shows that there were regime shifts among factor indices as well. The dominance of Value over Growth in…
- Categories Factors
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Building a Passive Bridge across the Pond
At over 300 years old, the British government bond and stock markets are among the world’s oldest. They are also among the largest globally; ranked by float-adjusted market capitalization, the U.K. gilt market and U.K. stock market are the fourth and third biggest, respectively. The British investment industry has existed for centuries, with the country’s…
- Categories Equities
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Examining Tactical Approaches to Sectors
Why does sector dispersion matter and how can it inform tactical approaches to sectors? S&P DJI’s Elizabeth Bebb and Invesco’s András Vig explore how sector dispersion can impact long-term asset allocations.
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Style, Size, and Skewness
Two of the biggest reversals of 2022 compared to 2021 were the outperformance of smaller caps and the outperformance of value compared to growth. Both of these factors helped drive the S&P 500® Equal Weight Index’s recovery last year, as well as a decline in market concentration. As sector and style exposures are not independent,…
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When the Winds Change
“Change is the investor’s only certainty.” Thomas Rowe Price, Jr. 2022 marked several major changes in market trends amid a substantial shift in global macroeconomic regimes. After historic levels of stimulus, multi-decade highs in inflation across several major economies led to monetary tightening. This shift weighed on asset classes in many regions, and traditional routes…
- Categories Equities, Factors
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2023, energy, Energy Select Sector, factors, S&P 500, S&P 500 Energy, S&P 500 Equal Weight, S&P 500 Equal Weight Index, S&P 500 Pure Value, S&P 500 Value, sector, sectors, Sherifa Issifu, Style, U.S Equity Indices, U.S., U.S. Core, U.S. Equities, U.S. factors, U.S. sectors, U.S. style, United States
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- 2023, energy, Energy Select Sector, factors, S&P 500, S&P 500 Energy, S&P 500 Equal Weight, S&P 500 Equal Weight Index, S&P 500 Pure Value, S&P 500 Value, sector, sectors, Sherifa Issifu, Style, U.S Equity Indices, U.S., U.S. Core, U.S. Equities, U.S. factors, U.S. sectors, U.S. style, United States
Contextualizing Style Shifts
The S&P U.S. Style Indices are designed to provide broad and exhaustive exposure to the market’s value and growth segments. Our index methodology bifurcates a parent index’s market capitalization into roughly equal portions on the third Friday in December, using six measures shown in Exhibit 1. Although the composition of style indices changes every year,…
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Style Chicken or Sectoral Egg?
Anyone who has perused our S&P 500® Factor Dashboard for December 2022 (and it’s a shame if you have not) will recognize Exhibit 1 below. The horizontal axis represents the difference between the weighted average value and growth scores (at the beginning of 2022) for each of the 17 factor indices in our dashboard, while…
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Do Friendly Bears Exist?
“Never sell the bear’s skin before one has killed the beast.” Jean de La Fontaine. On Wall Street, bear markets represent declines of at least 20% from their highs. But on Main Street, bears are anthropomorphized as friendly. Here we look at whether bears can also be “friendly” in financial markets, looking at the S&P…
- Categories Equities, S&P 500 & DJIA
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A Lackluster 2022 for Canadian Equities
With less than two weeks remaining in 2022, the S&P/TSX Composite Index is down 5.7% YTD (a relatively mild decline compared to the S&P 500®’s 17.9% drop). The S&P/TSX Composite Low Volatility Index has underperformed, which is unusual for a down year, falling by 9.6% YTD. Volatility continued its uptrend since the last rebalance, rising…
Safe Harbors and Silver Linings
As we reflect on this year’s notable market themes, one trend is certain: it has been a tumultuous market characterized by rate hikes and inflation concerns across regions, with significant losses across asset classes. Crypto market performance added to jitters, with the S&P Cryptocurrency LargeCap Index down 66% YTD. Losses throughout the year culminated in…
- Categories Equities, Fixed Income, S&P 500 & DJIA
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- Equities, Fixed Income, S&P 500 & DJIA
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