On the Minds of Investors

How does anchor bias impact perceptions of sustainable investing?

Rapid evolution of strategies available under the sustainable investing umbrella has subjected SI perceptions to anchoring bias.

Which regions will outperform in the year of the vaccine?

Investors received positive news about the trials of three COVID-19 vaccines, giving them the freedom to look ahead at the broadening of the global recovery.

How strong will the fourth quarter economic recovery be?

Last week, researchers at the Atlanta Federal Reserve made waves when they released an updated “nowcast” for 4Q 2020 GDP growth. Unlike the official GDP report from the Bureau of Economic Analysis (BEA), which is released with a delay, the Atlanta Fed’s “nowcast” seeks to approximate present economic activity using available economic data for the quarter. If the “nowcast” is to be taken at face value, then, economic data have improved dramatically. According to the Atlanta Fed, recently released figures point to a strong increase in personal consumption and a surge in inventories, resulting in a 4Q GDP growth rate of 11% annualized, far above consensus expectations.

Should I be concerned over expiring credit facilities?

In a somewhat surprising move, US Treasury Secretary Mnuchin announced that the PMCCF, SMCCF, MLF, MSLP and TALF will expire at the end of the year and that unused funds be returned to the Treasury.

What can COVID-19 vaccines tell us about the opportunity in small caps?

For investors that can stomach potential risks, small cap stocks may offer opportunities for meaningful upside, particularly as the economic recovery strengthens in 2021.

Will holiday retail sales be naughty or nice?

The holiday shopping season is upon us again, but with economic hardship caused by the ongoing pandemic, there is some concern as to whether this retail season will be merry and bright.

How can I use alternatives for income and diversification?

Although rates have moved higher during the past few weeks, investors are still struggling to generate income without increasing portfolio volatility. More and more, however, alternative investments are providing a solution.

How will the U.S. election impact the U.S. dollar?

In a recent post, we argued that the main way the U.S. election had been impacting international markets was through the U.S. dollar. Indeed, this continued after Election Day as well, with a significant move down in the dollar of 1.4% in the three days after the election was held. This depreciation of the dollar is a reaction to the expected outcome of a Biden Presidency combined with split party control of Congress. 

No (Fed) news November

In the midst of the busiest political week of the year and with the outcome of the presidential election still uncertain, the Federal Open Market Committee (FOMC) did its best to fly under the radar at its November meeting.

What made 3Q GDP so strong?

The 3Q 2020 GDP print revealed the full strength of the U.S. economic rebound in the aftermath of one of the worst recessions in living memory.