Tag Archives: GARP
The S&P GARP Index Series Expands to Include S&P MidCap 400 and S&P SmallCap 600 Versions
The S&P 500® GARP (Growth at a Reasonable Price) Index was launched in February 2019 to strike a balance between pure growth and pure valuation. Due to its popularity among market participants, this index series has recently been expanded to include the S&P MidCap 400® GARP Index and the S&P SmallCap 600 GARP® Index. The…
S&P 500 GARP Index: Growth at a Reasonable Price Anyone?
While growth stocks have the potential to grow at a rate significantly above the market, they have faltered during 2022 on the back of high inflation and rising interest rates. For market participants toying with the idea of when and how to get back in, the S&P 500® GARP (Growth at a Reasonable Price) Index…
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The Case for The S&P 500 GARP Index
The S&P 500® GARP (Growth at a Reasonable Price) Index just had its second anniversary since its launch in February 2019. During the latter half of this time, the world experienced the worst global pandemic in a century. Equities entered a swift V-shaped bear market and rebound. In this blog, we review the index’s performance,…
Using GARP Strategies for Indices Part IV – Factor Exposures, Sector Composition, and Performance Attribution
In this blog, the fourth in our introduction to Growth at a Reasonable Price (GARP) strategies, we cover factor exposures, sector composition, and performance attribution. Targeted Factor Exposures Exhibit 1 shows the active exposures (in percentages) of the S&P 500® GARP Index to the five factors used in GARP strategies: three-year sales per share (SPS)…
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Using GARP Strategies for Indices Part III – Risk and Return
In this blog, the third in our introduction to Growth at a Reasonable Price (GARP) strategies, we look at risk and return. The main objective of the S&P 500® GARP Index is to capture the performance of growth stocks with relatively high quality and value composite scores over a long-term investment horizon. Historically, the GARP…
Using GARP Strategies for Indices Part II – Constituent Selection
In a previous blog, we took the first and second steps in our Growth at a Reasonable Price (GARP) strategy construction. We introduced the GARP investment strategy and showed how it can be implemented systematically. In this blog, we will take the third and fourth steps: using a multi-factor sequential filtering process for security selection…
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Using GARP Strategies for Indices
In this blog (and three subsequent posts) we will explore using Growth at a Reasonable Price (GARP) principles for investment in indices. GARP is a well-known, much-practiced, fundamental-driven investment strategy. It seeks to balance between the pure growth strategy and pure valuation strategy, as the former tends to chase high growth yet expensive stocks, while…
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