Tag Archives: S&P 500

Volatility and Performance of Options-Related Indexes in the 2010s

As we enter the 2020s with interest in worldwide geopolitical volatility, here are some key points about volatility and the performance of options-related indexes the 2010s. How Did Equity Volatility in the 2010s Compare to Volatility in Previous Decades? The average of the daily closing values of the VIX® Index in the 2010s was 16.9 Read more […]

What’s Your U.S. View?

Every year, certain trends take centre stage and help to explain market returns. For example, expectations over trade negotiations and Fed policy were useful for explaining market performance in 2019.  Many of these developments often appear obvious with the benefit of hindsight, but identifying the trends and their subsequent impact in advance is far from Read more […]

The Quality Factor Beat the S&P 500 in 2019

In 2019, U.S. equities posted double digit gains, with the S&P 500® returning 31.49%—its best year since 2013 and second-best in a decade. This continued strong performance highlights the potential difficulty of beating the S&P 500.[1] The question then arises: what strategy (if any) outperformed the S&P 500 in 2019? Our latest S&P 500 Factor Read more […]

U.S.-Iran Conflict – Financial Markets Appear to Look Past Another Geopolitical Risk

The financial market’s reaction to the escalation of tensions between the U.S. and Iran have so far been muted, even benign (see Exhibit 1). A little over a week from the U.S. killing of top Iranian commander Qassem Soleimani and Iran’s response (missile attacks on U.S. army bases in Iraq), and a casual observer of Read more […]

The Uncommon Average

The US stock market has delivered an average annual return of around 10% since 1926.[1] But short-term results may vary, and in any given period stock returns can be positive, negative, or flat. When setting expectations, it’s helpful for investors saving for retirement to see the range of outcomes experienced historically. For example, how often Read more […]

S&P Composite 1500®: Measuring Market Trends

The S&P Composite 1500 measures the U.S. equity market by combining three world-renowned benchmarks – the S&P 500®, S&P MidCap 400®, and S&P SmallCap 600® – which together encompass approximately 90% of U.S. equity market capitalization.  With 2019 in the rear-view mirror, it is obvious that last year was extremely positive for U.S. equities:  the Read more […]

2019: A Market Review

With 2019 coming to a close, market participants may use the time to evaluate portfolio performance and to assess what changes (if any) they would like to make based on return expectations and the market outlook.  While the future is uncertain – hindsight really will be 2020 when it comes to evaluating next year’s returns Read more […]

Common Confusion

The critics of passive investing are nothing if not creative.  One of their objections to the growth of index funds stems from the putative problem of “common ownership.”  The argument is that index funds’ ownership of many of the competitors in most industries encourages or facilitates collusive behavior.  “[T]he fear is that by owning chunks Read more […]

Winning by Losing Less

Except for a couple of hiccups, the U.S. stock market has more or less hummed along in an upward trajectory for 2019. Through October, the S&P 500 is up 23%. What is surprising is that the S&P 500 Low Volatility Index® outperformed the benchmark by almost 3%, gaining 26% over the same period. This is Read more […]

A Way of Seeing

A wise man told me years ago that sometimes the things we see are less important than our way of seeing.  As more formerly-active investors begin to use passive vehicles, it’s useful to consider if there’s a distinctly index-centric way of seeing, and what its elements might be.  I think that there are at least Read more […]