Research

Are You Sure You Need BATJ?

Many US equity managers have substantial positions in Chinese ADRs like Baidu, Alibabe, Tencent, and JD.com. With Chinese equities sharply selling off over the last several weeks, we investigated BATJ exposures through the lens of US equities. We conclude that US investors need to be highly confident in the alpha from BATJ to take on the incremental risk of owning them…

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Banks: 4 Controversies and 3 Variables to Monitor

We take a detailed look at the banks sector and uncover four investment controversies facing bank stock investors and three data points to monitor. We think these concepts apply broadly to investors in other industries as well…

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Where We Are and What We Should Do

We created twelve proprietary indices using over 100 variables that systematically process “macro” data. We smooth and transform the data to create twelve gauges of where we are in the investing world today. We then measure model efficacy during various regimes and use performance to recommend gross exposures. Today we recommend grossing up the following…

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The Double Whammy

Faster (slower) growth means disproportionately higher (lower) multiples. We analyzed the revenue growth rates of all non-value companies and observed a sustained non-linear relationship…

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Riskiest Tech Names

We think portfolio managers should be buying growth stocks again, focusing on positive free cash flow and margin expansion, not earnings-based valuation…

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Riskiest Sector Right Now

We strongly recommend equity investors run a portfolio with low gross exposure to REITs as we see several signs that make investment in REITs particulary risky today…

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Inflation Playbook Part 2

Last week in our first inflation note, we tackled the relationship between stock returns and interest rates, concluding that healthcare services and technology hardware..

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Inflation Playbook Part 1

The primary topic of interest following our initiation is inflation. We have been asked about how inflation unfolds, and what the relative investment opportunities…

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FAANGM

FAANGM (Facebook, Apple, Amazon, Netflix, Google and Microsoft) is 22% of the market capitalization of the SP500, the size of financials and consumer discretionary sectors combined. Would you own neither of those sectors?…

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