The S&P MARC 5% Excess Return (ER) Index started the year firing on all cylinders, with positive returns across all asset classes for the quarter—dimming memories of 2018, when all the underlying indices ended the year in red. Its asset class diversification and weighting strategy helped the index to stay positive throughout the quarter, despite Read more […]
Inflation in the US averaged 1.5% annually for the last five years with a peak of 2.9%. Despite today’s low and stable inflation numbers, anxiety that the price level will leap up is driving a search for the reasons it seems low. Today’s inflation is a bit lower than the average since 1914 of 3.2% Read more […]
Dividends and stock buybacks are two ways that a company returns capital to its shareholders. Investors can benefit from both, but is there a synergy that can result from combining them? We’ve seen a surge in both buyback value and the number of participating companies in recent years. In 2018, 444 of S&P 500® companies Read more […]
In general, it is a positive sign when a company buy back shares. This means the company believes its stock is undervalued and is confident about its future earnings. In recent years, buybacks have become increasingly popular. With a record number of companies buying back shares, how are these companies are faring? A company can Read more […]
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) Read more […]
The first quarter of 2019 was one of synchronized gains across stocks, bonds, and commodities. Stocks soared, with the S&P 500® up 13.6%, recording its largest first quarter gain since 1998. Amid a dovish tone from the Fed, U.S. Treasury yields declined, with the yield on the 10-year U.S. Treasury Bond falling to its lowest Read more […]
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 Read more […]
Fluctuating periods of “risk-on” and “risk-off” mean that spikes in equity market volatility and large drawdowns are increasingly common in today’s economy. Exhibit 1 shows events throughout the current market cycle causing notable rises in volatility and large drawdowns. With more of these likely in the future, as our long bull market cycle ages, how Read more […]
Today we examine the impact of the members of the S&P 500 Dividend Aristocrats Class of 2019 on the index’s factor risk and sector composition. In our previous blog, we introduced these new constituents and discussed their quality ranking. Risk decomposition of the S&P 500 Dividend Aristocrats using Axioma’s US Fundamental Equity Risk Model MH4 Read more […]
The December 2018 rebalance of the S&P 500 Dividend Aristocrats added four new companies, with the changes effective at the open of Feb. 1, 2019. The new firms are Caterpillar Inc., Chubb Limited, People’s United Financial Inc., and United Technologies Corp. These four companies have the distinguishing characteristics that allow them to be eligible for Read more […]