Today’s Good News Isn’t Bad for US Stocks

Believe it or not, recent US housing market gains, the slight reduction in jobless rates and other signs of a revival in US economic growth are making some investors bearish about US stocks.  We think their fears are misplaced.

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Emerging-Market Debt Offers More than One Kind of Diversification

One key attraction of emerging-market debt is that it can help investors to diversify existing portfolios of developed-market fixed-income securities. But there’s more than one kind of diversification, and more than one way to approach the opportunity, depending on each investor’s objectives.

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The Sand Continues to Shift in High-Yield Bank Loans

Investors continue to pour money into funds that invest in high-yield bank loans, reciting the numerous perceived advantages of this asset class. But investors’ thirst for loans is encouraging borrowers to be aggressive, and the risks seem to be rising. Here are three commonly cited benefits of high-yield bank loans, and our take on why [...]

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SMID-Caps: To Know Them Is to Love Them

Bruce K. Aronow and James MacGregor It’s an opportunity born of neglect. Small-cap stocks have historically been the star performers of equities, handily outpacing large-cap stocks. And because they can get lost so easily in the grand sweep of the markets, small companies are often misunderstood and mispriced. That makes them great sources of alpha [...]

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Cyprus Averts Disaster, but the Price is High

The European Union’s last-minute deal with Cyprus has headed off bankruptcy for now, but comes at a heavy price for uninsured bank depositors. Meanwhile, the move to impose losses on private creditors and growing complacency among policymakers could be storing up trouble for the future.

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Contrarian Investing and the US Auto Rebound

Kevin Simms and Ajit Ketkar When US auto sales were in the dumps three years ago, an investor predicting a rebound was considered about as credible as a used car salesman. Today, a bumper year for car sales is providing a great example of the enduring principles of long-term investing.

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US Stocks: Third Time’s the Charm

At 1550, the S&P 500 has regained the peak it reached in March of 2000 (when the tech bubble burst) and again in October of 2007 (before the credit crunch hit). But we think the third time’s the charm: We think the stock market still has room to rise because equities are now more attractively [...]

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Little Cyprus Sparks Big Contagion Fears

The situation in Cyprus is still very fluid and very serious—perhaps more so than in Greece last year. While the country may be too small to have a meaningful direct impact on the rest of the euro area, the big issue for markets is the potential for contagion to more systemically important countries.

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Don’t Be Afraid of European High Yield…
Be Selective

The European financial crisis continues to challenge high-yield investors. Some were wary of Europe’s issues and stepped away last year, only to see European bonds dominate through the unpredictability. Others want in now, but worry that they’ve missed the rally.

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Five Key Themes for Equity Investors

Equity markets have started to perk up in early 2013, yet lackluster economic growth is posing a challenge to corporate profitability. In this promising but complex environment, we’ve identified five key themes for equity investors that are worth watching as the year unfolds.

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