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Tag Archives: Hamish Preston

Jan 27, 2023

GICS Changes Are Approaching

After the close on March 17, 2023, changes to the Global Industry Classification Standard (GICS®) structure will go into effect in GICS Direct and in S&P DJI’s indices. These changes will affect most sectors and will change what it means to be sector neutral. For example, Exhibit 1 compares the S&P 500 sector weights at…

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Jan 16, 2023

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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Jan 9, 2023

Celebrating 20 Years of the S&P 500 Equal Weight Index

The S&P 500® Equal Weight Index launched on Jan. 8, 2003, so Sunday marked 20 years since the index first allowed investors to measure the performance of egalitarian allocations among S&P 500 constituents. The index is now tracked by various investment products globally, and it has potential benchmarking applications. Exhibit 1 shows that the S&P…

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Nov 9, 2022

Watch Your Weighting Scheme

2022 has witnessed a recalibration across financial markets, as investors have digested the impact of higher interest rates amid elevated inflation. Despite bouts of optimism that the U.S. Federal Reserve would take a more dovish stance, and better-than-expected corporate earnings, Exhibit 1 shows that the vast majority of large-, mid- and small-cap indices declined through…

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Oct 28, 2022

Why Core Construction Matters

Look inside the S&P 1500 and its core components as S&P DJI’s Hamish Preston explores the performance of Equal Weight and sector indices, as well as highlighting how positive earnings can influence performance.

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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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Jan 26, 2022

S&P SmallCap 600: A Pandemic Case Study

Index construction matters when seeking to understand differences in index characteristics and any resulting divergences in index performance. One of the clearest examples of the importance of index construction comes when comparing the S&P SmallCap 600® and the Russell 2000. Indeed, while both indices are designed to measure the performance of the small-cap U.S. equity…

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Nov 3, 2021

The S&P SmallCap 600 Turns 27

The S&P SmallCap 600® celebrated its birthday last week, marking 27 years since its launch on Oct. 28, 1994. Designed to reflect the performance of small-cap U.S. equities, the index’s cumulative total returns have been affected by trends and narratives impacting the equities segment, historically. For example, Exhibit 1 shows that the S&P 600™ was…

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Sep 29, 2021

The Decline of the Index Effect

The growth of passive investing has spurred suggestions that stock returns may be influenced by a so-called “index effect,” as trading by index funds responds to changes in index membership. If this were true, stocks added to the index would initially outperform amid buying pressure, while index deletions would underperform. Our recent paper—“What Happened to…

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Aug 12, 2021

Exploring the Potential Implications of Market Reversals

How has the market’s response to the pandemic impacted the potential opportunity set? S&P DJI’s Anu Ganti and Hamish Preston examine where market reversals took place and what they could mean for active management and asset allocation strategies moving forward. Read on: Style Bias and Active Performance

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