Is a Storm Brewing on the Global Horizon?

The current state of the global financial markets isn’t necessarily in alignment with what one would reasonably expect, according to a BloombergView article from earlier this month. Weak global growth, Brexit, suppressed oil prices and the “impotence” of central banks are among the factors that would indicate a move toward increased demand for U.S. Treasuries […]

Morgan Housel on Progress

As presidential candidates take swings at each other regarding the troubling state of the economy and what needs to change, it might be a good time to reflect on how far we’ve come. In a recent article for the Collaborative Fund, which provides capital for entrepreneurs, Morgan Housel offers an impressive account of our country’s […]

What Rising Rates Mean to Low-Vol Investors

“Confusing risk with volatility can be dangerous,” says a recent report by Greenline Partners, as it “can lead to seeing things that do not exist.” This according to an article published this past May in Chief Investment Officer. Greenline, the article states, found that low-vol strategies outperformed the index by nearly 1%-2% annually over the […]

To Stay or to Go When Fund Managers Change

Putting all of your eggs in one basket extends to your choice of fund managers as well as investments, according to a recent Barron’s article. While understanding a manager’s philosophy and approach should clearly play a role, the article argues that it is equally important to fully grasp the fund’s fee structure, its inner workings […]

Trading on Earnings Announcements Generates “formidable track record”

Before you dismiss this as a crazy investment strategy, consider that a recent study found it hasn’t done too badly, writes Steve Russolillo of The Wall Street Journal. Rutgers University professors Ivo Jansen and Andrei Nikiforov created a hypothetical trading strategy built around earnings announcements that demonstrated what Russolillo calls a “formidable track record.” The […]

Sonders Says Recession Risk is Low

Although there are those that believe the U.S. is on the brink of recession, Liz Ann Sonders, Charles Schwab’s chief investment strategist, says the risk is low. This according to CNBC’s report on her commentary at the Morningstar ETF Conference in Chicago earlier this month. While Sonders says there are no clear buy signals at […]

Change is Coming for Financial Advisers

It seems that artificial intelligence is useful for more than just Pokémon Go. According to Jason Zweig’s recent blog in The Wall Street Journal, financial advisers are increasingly using the technology to better serve the needs of their clients. While advisers can understand a client’s situation by gauging their mood and asking questions concerning goals, […]

Canadian Stocks Offer Value

Since the start of the bull market in March 2009, U.S. equities have outperformed Canadian stocks. However, things are changing and the Canadian stock market is coming on strong, writes Validea CEO John Reese in an article for The Globe and Mail. Despite the trend, however, Reese says that Canadian stocks are still “better bargains […]

Piotroski-Inspired Stock Ideas

Joseph Piotroski is a roll-up-your-sleeves market guru who combines academic and mathematical theory in his investment strategy. In an article forTheStreet, Validea CEO John Reese offers background on Piotroski and explains the stock screening model he developed based on this guru’s book-to-market value centered philosophy. Using this model, Reese identifies the following high-scoring picks: Atwood […]

Momentum Investing is Back, At Least for Now

The strategy of buying whatever sector has had the greatest price or earnings gains in the past twelve months seems to have come back in fashion, according to a recent article in Investment News. The article cites a recent white paper by AQR that addressed momentum investment results and reported that “trend-following has delivered strong […]

A To-Do List for Active Managers

A new book entitled Winning at Active Management: The Essential Roles of Culture, Philosophy, and Technology, co-authored by William Priest, CEO at Epoch Investment Partners, addresses the reasons behind the difficulties active managers are facing as well as some strategies they can use to overcome them. An excerpt of the book was recently published in […]

The Information Factor in Stock Prices

The manner in which financial markets incorporate information is a function of the positioning of information as well as whether or not its current, according to research reported in the Harvard Business Review by Ph.D. candidate Anastassia Fedyk. Fedyk argues that, while freely available information lays the foundation for “efficient and transparent markets”, putting news […]

Hedge Funds Hungry for Quants

If you’re looking to land a job at a hedge fund, polish up your algorithm building and data mining skills to get to the front of the line. This according to a recent Bloomberg article that explains how hedge funds are hiring quants “like never before in search of an answer to lackluster returns.” King […]

Is Value Investing Getting Short-Changed?

A report published last month by investment management firm Research Affiliates, LLC addresses the question of why value investing (a smart-beta strategy using value indicators such as CAPE or price-earnings ratios) has “fallen out of favor in institutional portfolios,” according to an article in Chief Investment Officer. The authors of the report argue that value […]

Zweig on the Impact of Index Funds

Last month marked the fortieth birthday of the first index fund (launched by John Bogle, founder of the Vanguard Group) and the anniversary has triggered a lot of discussion and reflection on the trajectory this class of funds has traveled since. Jason Zweig of the Wall Street Journal shares some thoughts on the subject and […]

Are the Markets Really Efficient?

Warren Buffett has always been open about his approach to investing, singing the praises of focusing on business fundamentals to find strong stocks at good prices. However, in a recent BloombergView article, columnist Noah Smith outlines some reasons why the Buffett philosophy actually contradicts the efficient market hypothesis (EMH), an investment theory that says it’s […]

Investing Principles Part V: Buying Small Cap Stocks

In our final installment of discussion of the Tweedy Browne publication What Has Worked In Investing, we’ll take a look at the relative performance of small-cap versus large cap stocks. We addressed this subject in a recent article for Forbes that discussed the potential relative performance of small and large cap stocks in general terms […]

Want Private Equity Like Returns? Try a Levered Small Cap Stock Approach.

One young hedge-fund manager says that an investor can enjoy the same hefty returns touted by private-equity firms (through the purchase, turnaround and resale of troubled companies) through buying highly leveraged small-caps stocks. That manager, Dan Rasmussen, is profiled in a recent article by Forbes’ Daniel Fisher. Rasmussen makes the bold argument, Fisher writes, that […]