Respected Model Flashes Bullish Stock Outlook

The Value Line Investment Survey, a respected market timing model that “has an excellent track record predicting the market’s return” is predicting that the median U.S. stock will “produce an annualized price-only gain of 6.0% over the next four years.” This according to a recent article in MarketWatch by contributor Mark Hulbert. The survey prediction, published each week under the name Value Line Median Appreciation Potential (VLMAP), represents the median level of projections made by… Read More

Small Caps’ Collapse and What’s Behind It

A recent article in CityWire examines why the small-cap Russell 2000 index has underperformed its large-cap counterpart over the long-term, contrary to the widely accepted view introduced by Nobel laureates Fama and French back in 1992. “Much has been written lately about growth versus value and what may, or may not, have changed,” the article says, outlining what it describes as the “small-large dichotomy.” Here are some key takeaways: One key reason for the performance… Read More

Sam Zell: Pandemic to Permanently Scar Economy

Billionaire Sam Zell, known for buying distressed real estate, said the coronavirus pandemic will impact the economy the same way the Great Depression did 80 years ago, with lasting changes in human behavior that will negatively impact many business models. This according to a recent interview with Bloomberg. Zell said, “We’re all going to be permanently scarred by having lived through this,” adding that he expects some degree of social distancing and working from home… Read More

Famous Poker Player Helps Investors Play Tough Hand

In recent interview with Barron’s, award-winning poker player Annie Duke shares insights about how investors can remove emotions from decision-making and “how global markets are really just one giant poker table.” Here are highlights from the interview: On today’s uncertain environment, Duke contends, “The coronavirus is so clearly uncertain that people are more open-minded today, and because of that you can actually learn.” On decision-making and timing, Duke argues that businesses today are facing particularly… Read More

Ask Which Market Your Fund is Beating

In a recent Wall Street Journal article, columnist Jason Zweig highlights and questions the fee practices of a Putnam Investment mutual fund, noting that the interests of fund managers and investors can sometimes become “misaligned.” Zweig writes that the Putnam Capital Spectrum Fund, launched in 2009, touted “unusual objectives and fees”: It could buy any securities its manager (David Glancy, who has since left Putnam) found attractive and charged a “fulcrum” fee that matched downward… Read More

Ray Dalio Explains Changing World Order

Billionaire investor Ray Dalio’s upcoming book, “The Changing World Order” attempts to explain how “money, credit and debt work” by sharing his work with historians and political experts to “connect pieces of the  past  together to better understand the future.” This according to a recent article in Bloomberg. Dalio delves into the meaning and impact of money, arguing that most currency has no intrinsic value, does not represent wealth, and typically ends up getting devalued… Read More

The Misuse of Market Valuation

By Jack Forehand, CFA There is perhaps no piece of information that is more misused in equity investing than the valuation of the market. Whether someone has an agenda to show that the market is expensive, or that it is cheap, it is usually very easy to find data or a chart to prove their point.  Even for those who don’t have an agenda, it can be very easy to fall into the trap of misusing… Read More

Validea Webinar: A live walk-through of the tools & research found on Validea

Learn how investors utilize our guru and factor strategies, model portfolios, stock screens and other stock research and analysis tools on Validea. When: Tuesday, May 12th @ 1pm EST Host: Justin Carbonneau Features We’ll Look At: Guru Analysis, Model Portfolios, Stock Screners, Stock & ETF Factor Reports, ETF Model Portfolios, Trend Following and More. Estimated Time: 45 Minutes Q&A Session at End: Yes Register Today For Validea’s Live Webinar

Excess Returns, Ep. 23: The Challenges of Multi-Factor Investing

The basic theory of multi-factor investing is pretty simple. It has been widely proven that factors like value and momentum can outperform the market over long periods of time. But no reward comes without risk. In this case, the risk is the significant periods of underperformance that the factors can endure. That is where multi-factor investing comes in. It offers investors an opportunity to blend factors together to reduce risk and smooth out those bad… Read More

CalPERS’ Untimely Tail-Hedge Unwind: The Inside Story

After “cutting its crash-hedging program as part of a cost-curtailment effort and because of a lack of understanding of how tail hedges work,” the California Public Employees’ Retirement System (CalPERS) missed a payout of more than $1 billion when markets crashed in March. This according to a recent article in Institutional Investor. Last October, facing mounting pressure from investors worried about the bull market ending, CalPERS decided to curtail the costly hedging initiative which the… Read More