Capital markets could get a jolt if the US Federal Reserve raises interest rates faster and farther than expected. But we don’t think there would be a major sell-off in risk assets, and there are several ways for investors to play the possibilities.
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.
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. (more…)
Longer-dated oil futures contracts have been on the rise so far in 2014, and we think there’s a good case to be made that they’ve got further to go. The potential for an upside oil-price surprise may point to investment opportunity.
Is innovation dead or are we on the cusp of new technological revolutions? Without resolving this epic debate, we believe that market conditions today are conducive to investing in companies with disruptive potential, but it takes a sober approach to find big dreams that can deliver big returns.
This year’s equity market rally was initially led by defensive stocks, as macroeconomic concerns persisted despite improved risk appetite. With valuations in these sectors looking stretched and cyclically oriented stocks starting to rebound in May, is a bigger shift starting to unfold? (more…)
Equity markets have started to perk up in early 2013, yet lackluster economic growth is posing a challenge to corporate profitability. In this promising but complex environment, we’ve identified five key themes for equity investors that are worth watching as the year unfolds. (more…)
Companies around the world enjoyed especially high profit margins in late 2012. But can this trend be maintained or is profitability poised for a collapse that might threaten stocks this year? (more…)
Revisions to earnings forecasts started to improve in late 2012 as analysts’ worst macroeconomic fears eased. But this year, global companies may find it tougher to boost profits while their pricing power remains weak. (more…)
Nobody likes to be stuck for too long on a crowded bus or train—especially when it’s time to get off. But when it comes to stocks, we often overlook the risks of getting trapped with too many people in an untenable position. (more…)