Share buybacks are a controversial topic, in part because they are not well understood. This article will explain stock buybacks and summarize key finding from recent research by Two Sigma: Share Buybacks: A brief Investigation. Q: What is a share buyback? A share buyback occurs when a company buys back their own shares in the […] Read the full article…
Stock market returns for US stocks, international developed stocks and emerging market stocks through November are all above 20%. Now is a good time to update our relative value analysis for various equity asset classes and US vs. international markets. In this review, I am going to introduce a new relative value analysis model that […] Read the full article…
We are underweighted in developed country international stocks vs. US stocks. There are a number of factors that have led to this underweighting. In this article I’d like to discuss the relative value of US stocks to international stocks. The focus here is on developed country stocks which excludes emerging markets. Relative Value Analysis Our focus […] Read the full article…
In the first part of this article we covered macroeconomic conditions and asset class return projections for equities. In this article we will discuss fixed income as an asset class and then move to a discussion of asset allocation and portfolio construction. Fixed Income Central banks have driven interest rates down across the globe. Interest […] Read the full article…
In this article, I will introduce two different performance measurements that are commonly used in reporting returns. I will provide an introduction, explain the usefulness of each measure and then walk through an illustrative example showing how the two measures can differ. Introduction If we invest $1 and the return over one period is 5%, […] Read the full article…
Today I want to explore a very interesting post written by Philosophical Economics found here. In the post, the author shows that there is a strong relationship between US investor equity allocation and future 10 year returns. In fact, he shows that past equity allocation explains greater than 90% of stock market returns. Using R […] Read the full article…
In part one of this series we reviewed the basic composition of the Vanguard Health Care Mutual Fund (ticker VGHAX) using Morningstar’s website. In this article, we will look at details related to the fundamentals of the fund as well as performance of the fund relative to benchmarks. Before moving on, I wanted to highlight […] Read the full article…
Morningstar is research firm that provides data and analysis on a wide range of investments including individual stocks, mutual funds and exchange traded funds. Morningstar serves retail clients as well as investment professionals. In this three part series, I want to provide investors with an educational review and critique of data available from Morningstar. My […] Read the full article…
In this article, I want to explore some of the quantitative tools we use at Brightwood Ventures to evaluation investment performance. We conduct performance assessments when we make investment selections for model portfolio implementation as well as ongoing performance monitoring. As a general rule, we are biased toward the use passive index investment funds, but […] Read the full article…
Getting a good sense for risk and return and how it is measured is vital to understanding your investments. In this article, I will break down the key measures of risk and return that really matter. By the end, you should have a good sense for these without having ever to actually dig into the details of how the statistics work or do any calculations. […] Read the full article…