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The Style Cycle: Equity Factors and Macro Data Diverge
The performance of equity factors such as value, quality and low risk tends to track the economic cycle, and their recent behavior has eased concerns among many investors that the economy is slowing. Yet we believe investors should be cautious. The value factor, which historically tends to perform well in expansions, has outperformed the more defensive quality and low-risk factors
Emerging Markets Record Mixed Performances in February
Emerging market equities saw mixed performances in February, with stocks in Asia faring better than stocks in Latin America and emerging Europe, which underperformed. Franklin Templeton’s Emerging Markets Equity team outlines what drove market moves during the month and where they see opportunities today. They see reasons to be optimistic about Brazil in particular. Three Things We’re Thinking About Today
The “Calm Premium”
The recent U.S. equity rally has coincided with a drop in volatility. But can that continue? Russ discusses. While the equity rally seems to have at least temporarily stalled, stocks remain near three-month highs. The rebound in equity prices has been driven by a sharp and relentless bout of multiple expansion. In other words, investors are willing to pay more
European Uncertainty Has Lowered the Price Tag for Quality Stocks
The fourth quarter of 2018 was tough on investors in European equities, and uncertainty appears to be rising as we enter 2019. But, the Invesco International and Global Growth team believes that environments like these can result in great prices for attractive businesses. In fact, we haven’t seen valuations in Europe this low since 2013. So, what is our outlook
All Asset All Access, March 2019
SUMMARY For long-term investors, we believe risk can be defined as the potential to not meet our wealth accumulation goals, as opposed to just a focus on short-term price changes of securities in our portfolios. Given today’s high prices and low yields for U.S. stocks and U.S. aggregate bonds, we believe they may have lower potential to meet long-term wealth
Why Economics Must Get Broader Before It Gets Better
Even as the public's skepticism toward their profession has grown, economists have continued to ignore increasingly obvious flaws in their analytical frameworks. A discipline long dominated by “high priests” must now adopt a more open mindset, or risk becoming irrelevant. NEW YORK – The economics profession took a beating after most of its leading practitioners failed to predict the 2008
Modern Monetary Nonsense
A number of leading progressive US politicians advocate using the Federal Reserve's balance sheet to fund expansive new government programs. Although their arguments have a grain of truth, they also rest on some fundamental misconceptions, and could have unpredictable and potentially serious consequences. CAMBRIDGE – Just as the US Federal Reserve seems to have beaten back blistering tweets from President
Shifting Strategies in Site Selection, China Trade Negotiations, and Inflation Targeting
People want jobs. Elected officials want what is best for their districts. Employers want to lower their costs. These are all good intentions, but aligning them can be difficult. Amazon and New York City recently learned this lesson the hard way. Governments around the world use economic development incentives to encourage new investment. Internationally, Ireland has been a leading applicant
Equities vs. Bonds? Look to China for Clues
These days the investing world seems split between two types of market participants: the believers and the skeptics. Firmly among the believers are investors in equity markets, which have rebounded sharply from their sell-off in late 2018, supported by a dovish pivot by the Federal Reserve, hopes of a trade-war truce between the U.S. and China, and the U.S. government
The Long View: China—The Indispensable Nation?
This is the final video in a four-part series that addresses some of the major themes we expect to shape the investment landscape for years to come. Click here for parts one, two and three. ERIC WINOGRAD I think that so much of the discussion about the trade war between the US and China misses the point altogether. Markets seem