Tag Archives: U.S. equities

Apr 15, 2021

Hidden in Plain Sight

International equity investors have long participated in the U.S. market, but their interest has often focused on the globally recognized blue chips included in benchmarks such as the Dow® and the S&P 500®. In doing so, they may be missing out on the long-term outperformance of smaller companies; presently, they may also be missing out…

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Mar 30, 2021

Opportunity Does Not Equal Attainment

We’ve previously argued that most managers should prefer above-average correlation, because the incremental volatility a manager accepts to pursue an active strategy will be lower when correlations are high. In addition, active managers should prefer above-average dispersion, because stock selection skill is worth more when dispersion is high. Both correlation and dispersion rose in 2020….

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Mar 25, 2021

Exploring Equal Weight’s Impact on Risk/Return

What are the potential risk/return benefits of the S&P 500 Equal Weight Index? S&P DJI’s Hamish Preston and Tim Edwards explore what’s driving the mega-cap trend, multi-decade highs in S&P 500 concentration, and potential applications for the S&P 500 EWI.

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Mar 25, 2021

Risk-Adjusted SPIVA Year-End 2020 Scorecard: No Evidence to Support Superior Risk Management Skills of Active Managers

Modern Portfolio Theory tells us that higher returns tend to be associated with higher risk. Active managers tend to boast about their risk management skills and claim that they can generate higher returns than passive funds on a risk-adjusted basis. The Risk-Adjusted SPIVA® Scorecard assesses the risk-adjusted returns of actively managed funds against their benchmarks…

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Mar 11, 2021

SPIVA U.S. Year-End 2020 Scorecard: Passive Continued Its Winning Streak

In a year that brought a pandemic, volatility, and policy stimulus, asset prices rose nearly across the board. However, positive absolute returns did not necessarily translate into success for active managers relative to their benchmarks. According to the SPIVA® U.S. Year-End 2020 Scorecard, most active fund managers in the U.S. underperformed their benchmarks over the…

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Jan 25, 2021

S&P 400 and S&P 600: Why Consider

Most investors are familiar with the S&P 500 index. Its mid and small cap counterparts, the S&P 400 and S&P 600 don’t get quite the same coverage in the financial press. Yet these are powerful tools that must not be overlooked. 1. Diversification of the Indices 2020 was indeed a peculiar year for US equities….

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Dec 10, 2020

Learning from Sector Changes in the S&P Composite 1500

The S&P Composite 1500® serves as a benchmark for around 90% of the U.S. equity market and offers a comprehensive perspective on it.1 Companies in the S&P Composite 1500 are classified into sectors based on the Global Industry Classification Standard (GICS®). As with the benchmark, the S&P Composite 1500 Sector Indices are weighted by float-adjusted…

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Dec 2, 2020

A European Perspective on the U.S. Mid-Cap Sweet Spot

Should European investors be looking beyond large-cap U.S. equities for core exposure? S&P DJI’s Tim Edwards and State Street Global Advisors’ Rebecca Chesworth explore the case for U.S. mid-caps through broad and tactical sector exposures.  

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Nov 17, 2020

Tesla Added to the S&P 500

Yesterday, S&P Dow Jones Indices announced that Tesla will be added to the S&P 500® prior to the open on Monday, Dec. 21, 2020. The Index Committee has not yet determined which current constituent Tesla will replace, nor how Tesla will be added to the index—because of its size, S&P DJI is seeking feedback through…

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Oct 26, 2020

Large and In Charge? Giant Firms atop Market Is Nothing New.

While the types of businesses most prominent in the market vary through time, the fact that a small subset of companies’ stocks account for an outsized portion of the stock market is not new. Moreover, research suggests these stocks’ best performance might be in the rearview mirror. The takeaway is that relying on well-established investing…

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