…smart beta funds, says that a “smart-beta crash” is “reasonably likely.” Smart beta funds have focused on stocks with characteristics such as low volatility or high momentum, spurred on by…
Search Results for: low-volatility funds
Stodgy Dividend Payers On Top So Far in 2016
…stocks) is down 0.8%. One reason for the interest in dividend payers is the perception that further Fed rate hikes are increasingly unlikely. Years of low rates make bonds less…
Rekenthaler: 3 Options for Outperformance
…to a buy-and-hold investor, the latter may be “a willing loser, but not a dumb one.” He suggests that this is the strategy behind many “smart-beta” funds. Timing the market:…
Morningstar Study: Long-term Outperformance Not Predictive of Future Outperformance
…at the returns of actively managed funds as of the end of 2014 to determine if there is any persistence in the mutual fund returns” by grouping funds “into one…
Joseph Stiglitz Critiques Post-2008 Financial Policy and Suggests Reform
…boost consumption and investment,” and suggests the failure is partly due to “perverse incentives.” Stiglitz argues that, overall, QE and ultra-low interest rates “stimulated sharp increases in leverage, market capitalization,…
An Argument for a 100% Equity Portfolio
…100 percent stocks.” He notes Warren Buffet’s advice to allocate 90% of assets to equities, suggesting this may be a tempering because “many investors simply cannot stomach the volatility that…
The Risk of Investing in "Smart Beta" Funds
…performance.” For example, some funds are based on “low volatility” stocks, which were “about half as expensive as the market overall” from the 1970s to early 2000s, but are now…
“Portfolio Drag” as the True Cause of Underperformance
…increases in a fund’s top 20 stocks increase alpha, while increasing the weighting of lower weighted stocks has a negative effect on alpha. Overall, Howard concludes that his “PDI…
Jeremy Grantham's Outlook for 2016 and Beyond
Jeremy Grantham authored a piece for Barron’s recently in which he argues that “the positive effects of low resource prices are underestimated,” maintains that we are not in a bubble…
Ed Yardeni's Optimistic View of the U.S. Economy
…explained part of the recent downturn by noting that “when the dollar is up 22% . . . it is equivalent to a 100-basis-point increase in the fed funds rate”…