JPMorgan: Why Doesn’t Anyone Like Energy Stocks?

JPMorgan believes it is finally energy stocks’ time to shine, according to a recent article in Bloomberg. “The U.S. energy industry features the second-worst performing group of stocks in the S&P 500 this year, up 5.3% compared with an advance of 19% for the broader gauge,” the article reports, adding, “That’s despite love from Wall Street analysts, attention from some Asian investors, and votes of confidence from the likes of Morgan Stanley Wealth Management.” The… Read More

Investing Lessons from Peter Lynch

A recent article in offers insights from investing legend Peter Lynch. Here are some highlights: “In the stock market, the most important organ is the stomach. It’s not the brain.” Lynch says tolerance for pain is paramount because there will always be market declines. “Most people do really well,” he says, “because they just hang in there.” “More people have lost money waiting for corrections and anticipating corrections than in the actual corrections.” During… Read More

O’Shaughnessy Insights on Value’s Terrible Performance

In a recent interview on the Bloomberg Markets Odd Lots podcast, O’Shaughnessy Asset Management (OSAM) co-CIO Chris Meredith talked about value’s long period of underperformance and shared some insights regarding the outlook and potential catalysts for a reversion. Here are some highlights from Meredith’s comments: Big technological discoveries have led to value’s underperformance. To gain perspective, OSAM looked at data going back to 1926 to see if there were any other periods with similar characteristics.… Read More

Factor Investing’s Brutal Truth

A new study published in the financial Analysts Journal argues that although asset managers can generate more returns by using market timing factors than they can with passive strategies, associated costs eat outweigh the benefits. This according to an article in Institutional Investor. The findings give investors cause to be “cautious about dynamic equity factor allocation compared with the simpler strategy of constructing a passive multi-factor portfolio,” the article reports. The study found that a… Read More

Rob Arnott Claims Victory on Factor Crowding

Research Affiliates Co-Founder Rob Arnott is feeling “redeemed” after the rotation earlier this month from growth to value outperformance, according to an article in Bloomberg that says, “it smacks of quantitative strategies growing in popularity so when the trend breaks, it breaks big.” In a phone interview with Bloomberg, Arnott said, “whether this is the start of a comeback for value is arguably the most important question here because value has underperformed now for 12… Read More

If Everyone Indexes, What Happens?

As passive investing continues to gain popularity, concerns have materialized about some unintended consequences, according to a recent article inMorningstar. The article outlines an interview with Morningstar’s director of passive strategies, Alex Bryan, who shares his insights. Here are some highlights: ·      One of the concerns, Bryan explains, is that as more people index, fewer become “dedicated to doing fundamental analysis on individual securities” and more end up buying and selling “the entire market.”  In that… Read More

Thomas Piketty’s New Blockbuster Guide

French economist Thomas Piketty is back with a 1,200-page guide to abolishing billionaires, according to a recent article inBloomberg. The article reports that his latest blockbuster, “Capital and Ideology” explains how governments should address inequality—”by upending capitalism.” The tome is a sequel to “Capital in the 21st Century,” which the article says has sold more than 2.5 million copies in 40 languages since 2013. “Six years on, there are more politicians pledging to redress the… Read More

Why Use One Value Factor When You Can Use Many

By Justin Carbonneau (@jjcarbonneau)—-Interested in chatting with Justin – let him know.—- Suppose you wanted to find the value stocks in today’s market using common value ratios. Which would you use and why? Would you lean more heavily on the price-to-book ratio, which is largely used in academic testing and originates out of the world of Graham & Dodd? Or would you rather use something like the price-to-earnings ratio, which is more common and uses… Read More

Buffett Protégé Starting Her Own Firm

One of Warren Buffett’s inner circle is leaving Berkshire Hathaway to start her own firm, according to a recent article in The Wall Street Journal. Tracy Britt Cool, who the article describes as one of Buffett’s “key lieutenants in recent years,” joined Berkshire in 2009 at the age of 25 as his financial assistant, a role he reportedly created for her. In 2014, the article notes, she became chief executive of Berkshire-owned company Pampered Chef.… Read More

“No-Name” Managers Deliver Winning Pitches at Sohn

Many little-known hedge fund managers who presented pitches at this year’s Sohn Investment Conference in New York identified stocks that rose more than 30 percent over the ensuing 12 months, according to a recent article in Institutional Investor. “Sohn began introducing next wave investors in 2014, setting the stage for the hedge fund industry’s rising stars to share their actionable ideas alongside high-profile managers like billionaire Leon Cooperman. After several years of lagging hedge fund… Read More