After another big year for stocks in 2013, many investors are questioning how much longer the bull market can run before it collapses from exhaustion. This doubt has intensified with the early 2014 selloff. However, based on what we see, it’s not time to worry about the market’s stamina yet. [Read More...]

Wallflower Value Stocks Are Ready to Dance
Global equities are notching new highs, valuations are elevated and talk of market bubbles is increasingly common. Yet, by our measure, the potential for outperformance in value stocks has rarely been better. How can that be? [Read More...]
Global Investing and the European Enigma
Equity investors are struggling to figure out how to approach the European enigma. It’s clear that a recovery is brewing, but there’s still too much uncertainty for comfort. In our view, distinguishing the European context from that of the US or Japan can help point the way toward unravelling the puzzle. [Read More...]
Cast a Wider Net for Asian Income Stocks
Equity income has been a hot theme for Asian investors. But safer sectors that typically provide higher dividend yields are expensive. By casting a wider net, we think attractively priced income stocks can still be found in unexpected parts of the markets. [Read More...]
Real Estate Alpha Hides in Smaller Neighborhoods
After a spectacular five-year run, global real estate stocks look headed for a period of more normal returns. We think winning in this space will require a more discriminating eye—and venturing into the often neglected nooks and crannies of the smaller-cap real estate world. [Read More...]
Beyond the Emerging Middle Class
For many years, the rise of the middle class in emerging markets has captivated the imagination of investors. We think this is an illusion. It’s the working classes who will be the real engines of consumer growth in developing countries. [Read More...]
Alarm Clock Goes Off on Dream Stocks
Investors have recently woken up to the reality of overpriced US momentum stocks in technology and biotech. But a knee-jerk shift toward defensive sectors isn’t the answer. [Read More...]
CAPE Fears Miss the Point
With the recent wobbles in the market, scary headlines about stock bubbles are back in the spotlight. We think all this foreboding overlooks an important point: In today’s low-return world, where better than stocks to put your money? [Read More...]
Australian Value Returns to Form
Investors in Australia have been wary of undervalued, risky stocks in recent years. But today, market conditions have improved and many attractively valued companies have strong balance sheets, which we think should support a continued recovery. [Read More...]
Will Small-Cap Stocks Close the Gap with Large-Caps?
Small-cap stocks have lagged large-cap stocks by a substantial margin over the past few months, but a close look at the causes makes us think they could be in for a reversal of fortune. [Read More...]
Ten Reasons to Stay Active in Equities
It’s often hard to resist the temptation of an inexpensive, passive equity allocation. But we think you can find plenty of good reasons to go active just by looking around the markets today. [Read More...]
Valuation puzzle
Equities are expensive. It’s difficult to argue against this. But does this also mean that markets will fall sharply? Assuming that there are plenty of other factors that could drag equity prices lower, the high valuation alone is probably not enough reason for a new market correction. Granted, the price-earnings ratio is high, in some cases even historically high. The Shiller PE, which looks at corporate earnings development over the last ten years, is over 30 in the US, which happens rarely. And the graph shows that Warren Buffett’s favorite valuation indicator – total market capitalization as a percentage of GDP – also indicates historically high equity valuations. Correction looming? Are the high equity valuations the harbinger of a correction? Given the high degree of … [Read More...]
Japanese Equities: Has the Third Arrow Fallen Short?
Japanese prime minister Shinzo Abe’s latest blueprint for sustained long-term economic growth was met with quite a bit of skepticism. It’s easy to play down the so-called Third Arrow as an assortment of cryptic reform measures. But we believe that there’s some substance that warrants equity investors’ attention. [Read More...]
Is a Big Equity Correction Imminent? Not Yet
Many investors think US stocks are due for a correction: They feel that the market has run too far, that the Fed has been slow to act, that complacency has created pockets of excess. Do these gut feelings mean a major equity correction looms? Not yet, in our view. [Read More...]
China’s Property Market: The Risks for Banks
Despite worries about a collapse in China’s property market, we think the financial system will navigate the coming credit cycle if banks can buy time to resolve loan problems—and receive government support if needed. [Read More...]
Can Real Estate Stocks Cope with Rising Rates?
After a sharp five-year rally in US real estate stocks, investors are questioning whether they may be vulnerable to a rise in interest rates. Our research suggests that global real estate stocks may be more likely to weather a changing rate environment. [Read More...]
After the Beta Trade in Emerging Markets
It’s getting harder to generate equity returns in emerging markets (EMs). Simply chasing the index—the so-called beta trade—won’t do the job anymore. But with a more discriminating, active approach, we believe investors can still capture opportunities in the next phase of the EM growth evolution. [Read More...]
Does Stock Picking Still Work in Emerging Markets?
Many things have changed in emerging markets (EMs) over the last two decades. Markets are more efficient than they used to be. But we believe that developing countries still provide fertile ground for finding stocks poised to outperform. [Read More...]
Time to Rethink China’s Equity Markets
Plans for a new Shanghai-Hong Kong trading system are among three developments that we expect will give a boost to China’s equity markets in the medium to long term. So despite concern about the economic outlook, now could be the time to begin rethinking China from an investment perspective. [Read More...]
Worried About US Stocks?
After a jittery January, investors in US equities are gritting their teeth. But even if equities lose some steam after last year’s rally, we think company fundamentals and the interest-rate environment should support a resilient market in 2015. [Read More...]