Content (52)

  • Too many equity managers, mediocre investment outcomes

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    Too many equity managers, mediocre investment outcomes


    How hiring too many investment managers drives unexpected outcomes  

  • How To Invest In Dividend Strategies Now

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    How To Invest In Dividend Strategies Now


    Companies globally are slashing dividends as they face a combination of declining revenues and regulatory measures discouraging dividend payments. Not surprisingly, companies are now prioritizing liquidity and solvency over returning capital to shareholders.

  • What Happened with ESG and Quality in Bond Market Turmoil

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    What Happened with ESG and Quality in Bond Market Turmoil


    The coronavirus crisis, which ignited steep increases in credit spreads and temporarily froze segments of the fixed income market, can give investors insight into how different types of bonds perform in financial turmoil. In that vein, we looked at performance from companies with high quality financials and strong environmental, social and governance (ESG) practices. We think investors should take note of the value these characteristics offer in this market.

  • Coronavirus Update - Market Risk of Epidemics

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    Coronavirus Update: Market Risk of Epidemics


    Investors face a new risk management challenge with the coronavirus. Past epidemics may shed some light on what could happen next. 

  • Capital Market Assumptions - 5 Year Outlook

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    Capital Market Assumptions - 5 Year Outlook


    Every year, Northern Trust’s Capital Market Assumptions Working Group develops forward-looking, historically aware forecasts for global economic activity and financial market returns that drive our five-year asset class return expectations and inform our asset allocation decisions. All of this comes together in the form of our long-term strategic asset allocations, which are used by institutional and individual investors worldwide.

  • 2020 Outlook - Everything In Moderation

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    2020 Outlook: Everything In Moderation


    We think 2020 will be another year of slow growth — durable enough to avoid recession but disappointing to those looking for improvement. The combination of moderate growth and technological innovation will continue to suppress inflation, bolstering the global central bank easing cycle underway.  This leaves us continuing to favor “lower-risk risk assets” such as U.S. equities and high-yield bonds.

  • Simple sustainable investing solutions may not work for bond investing

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    Simple sustainable investing solutions may not work for bond investing


    Combining sustainable investing and fixed income has the potential to deliver attractive long-term returns while delivering positive change. However, there are risks with doing so in a naïve way.

  • Bringing Sustainable Investing to the Bottom Line

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    Bringing Sustainable Investing to the Bottom Line


    By integrating ESG factors into their portfolios, investors are increasingly recognizing they can go beyond conventional financial criteria and invest in companies whose emphasis on corporate citizenship matches their own values. Yet even the staunchest proponent of sustainable investing acknowledges the importance of financial criteria. How, specifically, can we combine traditional and ESG research to achieve investment objectives surrounding risk, return and ESG performance?

  • Factor Profile: Quality

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    Factor Profile: Quality


    Quality Investment strategies are often focused on identifying companies that have a sustainable competitive advantage and / or have generated consistent shareholder value over time.

  • Share Buybacks or Composite Equity Insurance

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    Share Buybacks or Composite Equity Issuance?


    Even though factor investing is widely supported in academia and investment practice, forecasting and harvesting factor returns remains challenging for various reasons. One signal that has received more than a little attention of late is share buybacks.

  • Time to Refresh What Value Means

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    Factor Profile: Value


    While select equity factors have historically outperformed the broad equity market over the past 50 years, investors should be careful about assuming that what has worked to identify the right factors in the past will work in the future. The value factor is a good example. As technology and service companies become a larger part of the global economy, the traditional and simpler value metrics don’t work as well. Here is what investors can do.

  • Factor Profile: Momentum

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    Factor Profile: Momentum


    The momentum factor can provide alpha and diversification, but it can also be redundant because a significant proportion of the momentum premium stems from momentum in other factors. This is commonly referred to as factor momentum and can unintentionally lead to a doubling down on factor exposure and risks in multi-factor portfolios. Skilful risk management of factors is critical to avoiding this mistake.