Practical insights on ETFs, bonds and global markets for long-term investors – curated from fund managers, index providers and market analysts, with a link to every original source.
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Timing investment factors is difficult, but that doesn’t mean the growth-to-value rotation is getting less attention. While growth may currently be lagging, the future outlook is far less certain. Advisors can cover both bases while positioning for the expansion phase in the economic cycle with WisdomTree’s series of growth model portfolios .
Growth and value are perhaps the most obvious rivals in the factor universe. The two are the most paired in factor conversations, so it stands to reason that if one is performing well, market participants are likely to take unfavorable views of the other.
Traditionally, small cap companies come with more risk and volatility than their mid- and large-cap counterparts, but they also offer more upside potential. That’s true across the sector landscape – including in gold miners.
Inflation fears are not only spooking the equities markets, but the debt markets as well. In volatile times, it’s important to stress the importance of quality via funds like the FlexShares International Quality Dividend Index Fund (IQDF) .
There’s a dividend resurgence brewing in 2021, but that trend isn’t confined to domestic stocks. After paring or suspending payouts following the onset of the coronavirus pandemic, plenty of international companies are looking to restore and grow their payouts.
Fixed income investors looking to get high yield exposure outside of the U.S. while limiting duration risk will want to consider the Invesco Global Short Term High Yield Bond ETF (PGHY) . PGHY offers investors the yield they desire in this current fixed income environment.
Credit spreads are tightening, which could be causing investors to shy away from the extra risk associated with high yield, but there are safer options like municipal bonds and the Vanguard Tax-Exempt Bond ETF (VTEB) . The past month saw equities get racked with a bout of volatility as inflation fears put investors in a state of unease.
Broadly speaking, investors view emerging markets as riskier than developed economies, and the same is true when comparing high-yield corporate bonds with investment-grade fare. Combine emerging markets and junk bonds and the ingredients are there for risky and volatile recipe.
Investors looking for immediate, yet diversified, boosts to their income can look toward ETFs with high dividend yields. Dividend yield is a measure of how much of security’s value is returned to shareholders in the form of dividends.
Income-minded investors can consider an actively managed dividend exchange traded fund strategy to help keep ahead of inflation. The SmartETFs Dividend Builder ETF (NYSE Arca: DIVS) is an actively managed dividend growth strategy that seeks dividend-paying companies that have provided an inflation-adjusted cash flow return on investment of at least 10% in each of the last 10 years.
S&P Dow Jones Indices has unveiled the S&P Dividend Growers Index Series , a new family of indices tracking companies that have consistently increased their dividend payments every year for a specified number of years. The indices target companies that have consistently increased their dividend payments every year for a specified number of years.
History confirms that when the economy begins emerging from a recession, cyclical stocks typically outperform during the recovery phase. Not that growth stocks are down this year, but the group is significantly trailing cyclical value fare.
It’s often said that small cap value is one of the most potent factor combinations, one which handsomely rewards investors over the long-term. How well that thesis plays out over time remains to be seen, but for investors in 2021, small-cap value is obliterating other factors.