Many financial theories are based on the idea that riskier investments should offer higher returns. However, there is a bank of evidence – accumulated since the 1970s – showing that less volatile stocks posted higher risk-adjusted returns across a number of time horizons, regions, and market segments, historically. S&P Dow Jones Indices produces a range Read more […]
May was categorized by the return of macro fears. Many equities indices and fixed income indicators flashed red – and the S&P 500’s four month win streak ended – as investors grappled with trade tensions and the potential impact on global growth. Adding to investors’ uncertainty, President Trump’s surprise month-end announcement of tariffs on Mexican Read more […]
In investing, risk and return are two sides of the same coin; the expected returns of an asset must be accompanied by variation or uncertainty around the outcome of those returns. All else equal, higher-risk assets should be compensated, on average, by higher returns. The same philosophy applies to performance evaluation. The performance of both Read more […]
Despite the hovering cloud of geopolitical menace as we entered 2019, the U.S. equity market enjoyed an almost seamless rise through the first four months of the year. May’s retreat reacquainted investors with volatility and served as a reminder that the market is near all-time highs, having enjoyed a more or less sustained increase for Read more […]
After four consecutive months of gains by the S&P 500®, the U.S. equity market broadly declined in May. The S&P 500, S&P MidCap 400®, and S&P SmallCap 600® declined 6.6%, 8.1%, and 8.9%, respectively. The primary catalyst was the renewed trade tension between the U.S. and China, which reversed course from the optimism coming out Read more […]
This is more an eyewitness account than an analytical review of the growth of indexing since I joined S&P in 1982. At the beginning of 1982, few people saw indices as a business. There were only two well-known US indices – the S&P 500® and the Dow™ – and one index fund. Interest rates and Read more […]
Market gains in the first four months in 2019 more than made up for what it lost in the turbulent last quarter of 2018 as the S&P 500 jumped 18%. Predictably enough, the S&P 500 Low Volatility Index® trailed the broader benchmark (up a “mere” 16% in the first four months), although Low Vol has Read more […]
Global equities have been turbulent recently as a combination of stalled trade negotiations and announcements of tit-for-tat tariffs increased the prospect of a trade war between the U.S. and China. After its historic start to the year, the S&P 500 is down 3.7% so far in May, while many other markets have also faltered month-to-date. Read more […]
The S&P 500® was up 3.93% in April, marking the fourth consecutive month of gains. The YTD gain of 17.51% was the best since 1987 and the fifth-best in the entire history of the index. The index set a new all-time high in April, surpassing the previous high close from Sept. 20, 2018. This completed Read more […]
Tomorrow, Warren Buffett and 30,000 of his closest friends will gather in Omaha for Berkshire Hathaway’s annual meeting. The loyalty of long-term Berkshire shareholders is the stuff of legend, as is the investment performance that produced it. $100 invested in Berkshire stock at the end of 1968 would have grown to more than $850,000 by Read more […]
