Perspectives Blog

Interpreting the bond rally from a multi-asset perspective

Jeffrey Knight, CFA, Global Head of Investment Solutions and Asset Allocation | June 2, 2014

…opposite conditions. In fact, with bond yields having broken through to new lows (as of May 28), we observe that stock prices remain at record high levels, credit spreads are as tight as they have been all cycle and volatility across stock, bond and currency markets is notably subdued. Exhibit 2 Source: Bloomberg. Data as of 05/28/14 There is another difference that matters. Since bond yields ended 2013 at their highest level in years, the initi…

The new tax regime and stock compensation

Abram Claude, Vice President, Columbia Management Learning Center | October 30, 2013

…yroll and ordinary income taxes. The most well-known stock compensation program involves grants of non-qualified stock options (NQSOs). The grants are issued with a specific exercise price. Most NQSOs do not become compensation until the employee has reached a vesting period and elects to execute all or a portion of a stock option grant. At execution, the spread between the stock option exercise price and the fair market value becomes compensatio…

Is a stock market correction coming?

Jeffrey Knight, CFA, Global Head of Investment Solutions and Asset Allocation | December 16, 2013

Why we are not expecting a major correction The case for ongoing equity market strength Factors that might bring on a correction With markets near all-time highs and the potential for the Federal Reserve to begin tapering asset purchases, many investors are asking if the next market correction is coming and if it’s time to sell stocks. While we can never know for sure when a correction is coming, at this time we do not expect a large correctio…

Time, not timing

Columbia Management, Investment Team | November 26, 2013

…est days. Asset allocation, diversification and periodic rebalancing are tools investors can use to help weather market downturns. Sometimes the best selling strategy for investors may simply be — don’t. Focus on buy and hold for the long term. Over the past several decades the market has endured: the Iranian hostage crisis, a Savings & Loan collapse, the stock market crash of 1987, the fall of the dotcom stocks, an attack on the United Stat…

Should investors care about valuation?

Rich Rosen, Portfolio Manager | November 25, 2013

Is valuation an effective tool for deciding on whether to invest in a stock? We look at other drivers of a stock’s worth Earnings and earnings growth could be more useful in evaluating a stock’s worth Many of the market experts paraded around on the business programs, when asked about their forecast for stocks, often begin with a comment about valuation. But really, how effective is valuation as a gauge for determining whether it is a good tim…

Thoughts on navigating market volatility in today’s technology markets

Rahul Narang, Senior Portfolio Manager | April 28, 2014

We are seeing a market rotation from momentum to value on macro factors and internal market dynamics. Keys are to stay diversified, look for businesses with strong moats and that produce solid cash flow and compare to historical valuations. Favored themes are industry consolidation plays, mobile and Internet. In recent weeks there has been a dramatic shift in alpha generation from hyper growth technology stocks to more value-oriented names. We…

Has dividend investing lost its luster?

Columbia Management, Investment Team | May 12, 2014

Higher-yielding equities underperformed the market last year raising questions about whether dividend investing remains an attractive strategy. Even if rates continue a long-term increase from current levels, we expect that equities sensitivity to rising rates will decline. We believe the drivers that have resulted in historical stock market outperformance from high-yielding equities remain intact. By Paul Stocking, Senior Portfolio Manager an…