Institutional Investor (August 29)
“Now that investors can get factor-based funds on the cheap, they’re pushing quants in new directions.” This presents new challenges. “One is a move away from a heavy reliance on decades of historical data and back tests to tying this in-depth research to the realities of the current economic and market environment.” Another challenge is “getting the right people” to do this. “Many quant managers historically hired people with expertise in data,” but “now it’s the background in economics and finance that’s become critical.”
Tags: Back tests, Challenges, Cheap, Data, Economic, Economics, Factor-based funds, Finance, Historical data, Investors, Managers, Market, Quants, Realities, Reliance, Research
Institutional Investor (May 25)
“Managers that want to run fixed-income funds with a focus on environmental, social, and governance factors face larger research challenges than those in stocks. But the massive opportunity in bonds may make the uphill battle worth it.” Compared to equities, the “patchwork of standards” increases the “risks of ESG fixed income funds.”
Tags: Bonds, Challenges, Equities, ESG, Fixed income, Funds, Managers, Opportunity, Patchwork, Research, Risks, Standards, Stocks, Uphill
Washington Post (March 9)
“Stock analysts are riding with the bull despite rumblings from the bear.” On Monday, “U.S. stocks slumped the most in 17 months… but the ‘buy the dip’ mentality isn’t dead… and stock analysts are part of the reason it’s likely to stick around awhile. Research on individual stocks is as bullish as it has been in two decades by some measures.”
Irish Times (August 6)
“Ireland could have winters as cold as Toronto in Canada if a potential collapse in the Gulf Stream happens.” Recent research has found “the currents are already at their slowest point in at least 1,600 years” and “may be nearing a shutdown.”
San Francisco Chronicle (September 14)
“Recent research shows that warmer weather and less precipitation has more than doubled the frequency of autumn days with extreme fire danger in California. The situation is expected to worsen.” Tackling climate change would help as would better forest management, but climate change complicates thinning the forests. “The state’s fire season has grown by an estimated 75 days in recent decades,” narrowing the window then “crews can safely light fires to manage forest health.”
Tags: California, Climate change, Fire danger, Forest health, Forests, Precipitation, Research, Thinning, Weather, Worsen
WARC (August 27)
“Lockdowns have lasted longer than the 66 days research suggests it takes to form a new habit – so 2020 really will be an inflection point when we witness a paradigm shift.” COVID-19 has overturned our entrenched attitudes and assumptions, “halting much of what we have taken for granted, imposing new ways of living our lives and creating new boundaries.”
Tags: 2020, 66 days, Assumptions, COVID-19, Entrenched attitudes, Habit, Inflection point, Lockdowns, Overturned, Paradigm shift, Research
New York Times (May 30)
“E-commerce has been embraced for all manner of goods and services — books, travel, groceries, electronics — but auto sales have resisted the trend.” Consumers do frequently conduct research over the internet, but ultimately “have gone to dealers for most transactions. With the coronavirus and stay-at-home orders, that is changing.”
Tags: Auto sales, Books, Consumers, Dealers, E-commerce, Electronics, Goods, Groceries, Internet, Research, Services, Travel
Professional Pensions (November Issue)
“The problem with ESG fund ratings is primarily that they are fairly new—and are therefore prone to criticism that they are not detailed enough, are missing information, or are failing to analyse certain aspects of companies.” At this stage, “to truly reduce ESG risk exposure, those overseeing funds may need to do their own research and engage with companies to properly inform their decision-making.”
Tags: Criticism, Decision-making, Detailed, Engage, ESG, Fund ratings, New, Research, Risk exposure
Institutional Investor (June 14)
“Companies and their stake holders are increasingly anxious to add more women to their boards, a process that can be fraught with controversy…. But for all the hand-wringing,” a recent study from the Wharton School found that “companies do not perform any better—or any worse—when they have women on their boards.” This is “the research diversity experts don’t want you to read.”
Tags: Anxious, Boards, Controversy, Diversity, Experts, Hand-wringing, Performance, Research, Stakeholders, Wharton, Women
Institutional Investor (April 13)
“The sell side doesn’t quite get it yet,” but a major shift will soon transform their very existence. With Phase two of the EU’s Markets in Financial Instruments Directive (MiFID) scheduled to take effect in January, broker-dealers must “explicitly price a dark art whose cost was previously wrapped into trading commissions (on equity products) or spread (on fixed income). And that, in turn, could put a lot of analysts out of work in Europe, the U.K….and, in time, the U.S. and everywhere else.” Current predictions are that by 2020 global research volume will decrease by around 25% to 60%… or even more.
Tags: Analysts, Broker dealers, EU, MiFID, Research, Sell-side, Spread, Trading commissions, U.S., UK, Volume
