Perspectives Blog

The importance of taking a long-term perspective

Jeffrey Knight, CFA, Head of Global Asset Allocation | February 3, 2014

…ow investment grade U.S. dollar-denominated corporate bonds publicly issued in the U.S. domestic market. The Standard & Poor’s (S&P) 500 Index tracks the performance of 500 widely held, large-capitalization U.S. stocks. The MSCI EAFE Index is a capitalization-weighted index that tracks the total return of common stocks in 21 developed-market countries within Europe, Australia and the Far East. The MSCI EM Index is a free float-adjus…

Weekly market summary – 1/24/14

Columbia Management, Investment Team | January 27, 2014

…ow investment grade U.S. dollar-denominated corporate bonds publicly issued in the U.S. domestic market. The Standard & Poor’s (S&P) 500 Index tracks the performance of 500 widely held, large-capitalization U.S. stocks. The Russell 1000 Growth Index measures the performance of those Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values. The Russell 1000 Value Index measures the performance…

Asset allocation: The conundrum of 2014

Jeffrey Knight, CFA, Head of Global Asset Allocation | March 3, 2014

…vironment apparently changed, though, with the turning of the calendar to 2014. In the New Year, bonds have performed quite well, with yields on 10-year Treasuries, as an example, falling from 3.03% to 2.67% so far this year. Stocks meanwhile, have been volatile, yet stand close to unchanged on a year to date basis. Source: DataStream, February 2014 There are two good reasons for bond yields to have fallen this year. First, having closed 2013 ab…

Retail sector outlook – It’s a share game

Mari Shor, Senior Equity Analyst | March 17, 2014

…eason provides a useful prism through which to examine consumer behavior into 2014. On the positive side, comparisons ease as we cycle the payroll tax increase in 2013, and the “wealth effect” (net equity gains in housing and stocks) should drive sustained strength in consumer confidence. Unfortunately, the negatives seem to outweigh the positives with 1) lower levels of growth in disposable income forcing allocations across spending categories;…

What to make of the rebound in emerging market equities

Dara White, Senior Portfolio Manager | April 14, 2014

…take a closer look at the index constituents and exclude the Chinese banking and Russian energy sectors which trade in the low single digits P/E’s, the rest of the universe does not appear so strikingly cheap. There are good stocks to buy at reasonable valuations, but it is not the “close your eyes and buy the EM universe” cheap that it might appear to be at first glance. In order for this to be a sustained rally, we need a real pickup in export…

M&A in healthcare – Out with the old, in with the new?

Harlan Sonderling, CFA, Senior Healthcare Analyst | March 31, 2014

…se of the countries in which many of the new specialty pharmaceutical conglomerates are domiciled, thus ruining the benefits of low foreign tax rates and the promise of future tax inversions. Specialty pharmaceutical/generics stocks have done remarkably well over the past several years, particularly over the past 12 months, as the companies’ rapid inorganic (acquisition-derived), debt-fueled revenue and earnings growth has been prized. Similar ac…

Quality milestone in the European recovery story

March 17, 2014

Business, economic and political news all point to a strengthening recovery in Europe. We foresee a period of low inflation and low interest rates in Europe. We favor domestic European plays over internationally-exposed stocks, with an overweight stance in banking and telecoms. By Paul Doyle, Head of Europe ex. UK equities and Frederic Jeanmaire, Fund Manager, Threadneedle Investments After 18 consecutive negative months, the flow of eurozone…