More From David Ashworth
Key for Investors: Report from the G20 Summit, September 2015
The G20 is a forum of 19 countries and the EU that convenes to discuss policy level enhancements required for the global economy and the group.
How Did US Financial Markets Fare in October 2015?
The S&P 500 index, tracked by the SPDR S&P 500 ETF (SPY) and the iShares Core S&P 500 ETF (IVV), rose 8.3% in October.
As Brazil’s Situation Worsens, What about Your Mutual Fund?
Impeachment proceedings will begin against Brazil’s president Dilma Rousseff after the country’s lower house accepted a plea for the same.
High Yield Bond Funds Witness Inflows in the Week to May 22
Investor flows in high yield bond funds turned positive last week. Net inflows totaled $906 million in the week ended May 22.
Analyzing JPMorgan Intrepid European Fund’s Allocation in 2015
The JPMorgan Intrepid European Fund’s assets were spread across 79 holdings as of December 2015.
Industrials Save Ivy European Opportunities Fund in August 2015
The Ivy European Opportunities Fund fell 5.5% in August from a month ago—the least among the six mutual funds under this review. Beyond this period, the fund’s performance has been less impressive.
Analyzing the MFS Growth Fund’s 2015 Portfolio
The information technology, consumer discretionary, and healthcare sectors form the core of the MFS Growth Fund.
Will Banco de Mexico Follow the Fed in Raising Rates in 2016?
Since the rate hike by the Fed in December 2015, Banco de Mexico has raised rates three times totaling 125 basis points.
Kocherlakota said the FOMC could have done more for labor markets
In evaluating the FOMC’s performance over the past three years, Kocherlakota mentioned that the unemployment rate fell to 5.6%.
How the Vanguard PRIMECAP Fund Performed in 2015
Vanguard PRIMECAP Fund states that fund managers have a long-term perspective while managing this fund and they do it with an “extremely low turnover.”
Outflows in High Yield Bond Funds Slow Down
Net inflows in high yield bond mutual funds were negative for the second time in eight weeks. Net outflows totaled $1.0 billion in the week ended March 20.
International Monetary Fund: Global Economy to Slow Down in 2015
In this series, we’ll look at the International Monetary Fund’s expectations for economic growth around the world, and we’ll explore how these projections might affect your investments.
G20 leaders are emphasizing fiscal policies
The G20 finance ministers and central bank governors emphasized the role of fiscal policy in building confidence and supporting domestic demand.
How Did the Markets React to the Fed’s Rate Hike?
For the past month or so, several equity investors have anticipated a rate hike and factored it into stock prices, readying their portfolios for the event.
Issuers Return to the Leveraged Loan Primary Market
AlixPartners provides financial advisory and business services. It issued leveraged loans worth $1.1 billion last week. The B2/B+ rated covenant-lite Term Loan B was issued for seven years.
Non-farm payrolls, average hourly earnings rise
US non-farm payrolls rose by 295,000 in February 2015 from a downwardly revised January number of 239,000 compared to 257,000 reported earlier.
Inside the World Bank’s Growth Expectations for the Eurozone
The World Bank has lowered its expected growth rate for the Eurozone to 1.6% in 2016 and in 2017—0.1 percentage point lower than January’s projection.
Is It Time to Invest in International Funds?
2016 has mostly been about macro trends, thus presenting a different set of challenges for active fund managers who mostly focus on companies rather than economic and sector trends.
FOMC Statement Moves Financial Markets
Two rallies after the FOMC statement led the NASDAQ Composite Index to its highest closing in 15 years, just below its all-time high of 5,048.62 in 2000.
Policymakers Are Pleased with February 2015 Labor Market Data
The minutes of the FOMC’s (Federal Open Market Committee) March 2015 meeting revealed that policymakers were happy with improvements in the labor market.
What New Developments Can You Expect from the Fed?
Potential new developments from the Fed include a suggestion by the subcommittee on communications that median values of policymakers’ projections be published.
How Foreign Developments Can Impact US Monetary Policy
Because the Fed wants to maintain stability in US financial markets, it is important to assess whether present foreign developments will put the domestic market through tumultuous times.
Subdued Inflation in Japan: A Case for More Stimulus?
Inflation in Japan, as measured by the consumer price index, rose just 0.2% in July from a year ago. The Bank of Japan has a target of 2% for inflation in Japan.
Lack of Rate Hike in September Leads US Stocks Down
The US Federal Reserve met on September 16 and 17 in one of the most anticipated monetary policy meetings in recent memory.
How Did the Markets React to the Fed’s March Meeting Minutes?
Treasury yields barely reacted to the March meeting minutes on a day-to-day basis. Treasury bills ended unchanged on April 6 from the previous day.
How a Slowing Economy Impacts the US Labor Market
The health of the US labor market is possibly the primary reason the FOMC (Federal Open Market Committee) had confidence to raise interest rates in December 2015
Bill Gross Analyzed ‘Carry’ in Credit Risk, Volatility, and Liquidity
In his June 2016 investment outlook, Bill Gross stated that “credit risk or credit ‘carry’ offers little reward relative to potential losses.”
10-year Treasury notes auction saw weak demand
The ten-year Treasury notes auction saw a lower bid-to-cover ratio than last month. The ratio was 2.6x—compared to ~3x in December.
Why Goldman Sachs Looks Bullish on WTI Crude but not on Gold
Goldman Sachs expects WTI crude oil price to be $55 per barrel in 1Q17 and 2Q17. These estimates were raised from $45 and $50 per barrel, respectively.
Checking in with the JPMorgan Large Cap Growth Fund in November
The JPMorgan Large Cap Growth Fund Class A invests in “large-cap companies with market caps similar to those within…the Russell 1000 Growth Index.”
China’s PMI and US Job Additions Push US Stocks Down
US stocks didn’t have a great start last week. Reports emanating from China drove US markets down sharply, but they rebounded the next day when Microsoft (MSFT) helped them bounce back.
Economists Disagree with Trump’s Fiscal and Trade Deficit Views
Donald Trump has been vociferous about cutting taxes. He intends to reduce the current seven tax brackets to three.
Is the FOMC Confident about Effecting a Rate Hike in 2015?
Though policymakers have clearly stated that they’d be data-driven while deciding on effecting a rate hike, it seems that there’s more than economic indicators on their mind.
NASDAQ Soars with Equities, Treasuries Fall Last Week
US equity markets gained in the week ended April 24, 2015. But the week was all about the NASDAQ, which gained 3.2%.
Benefit of Hindsight: The Fed Wasn’t Going to Raise the Rates
Some participants had maintained that the Fed shouldn’t raise rates in September, but many participants thought that the Fed would “liftoff” at this meeting.
Yields on Investment-Grade Corporate Bonds Remain Low
If spreads are rising or widening, credit conditions can be assumed to be worsening. Spreads widen when growth is slow and economic conditions worsen.
High Yield Bond Funds Witness Inflows for Second Consecutive Week
Investor flows in high yield bond funds were positive last week, making it the second successive week of inflows.
Why Kocherlakota wants the Fed to be free in its decision making
Kocherlakota gave a presentation at the annual American Economic Association conference. He was firmly in favor of letting the Fed be free in its decision making.
Big Forces Behind India’s Future Monetary Policy
Rate cut transmissions by commercial banks, inflation, and monetary policy actions by the Fed will have the largest influence on India’s future.
How will the Federal Reserve go about policy normalization?
Monetary policy normalization refers to two aspects: the federal funds rate and the Federal Reserve’s balance sheet.
Why did new home sales surge in December?
New home sales jumped 11.6% in December from a month ago to a seasonally adjusted annual rate of 481,000.
The Federal Reserve’s patience: Is it here to stay?
The January 2015 meeting minutes showed that several policymakers weren’t in favor of dropping “patience.” Changing the language is a big deal.
Consumer Spending Edges up in February 2015
Consumer spending remained subdued in February. The harsh weather kept consumers indoors. Individuals used the gains from lower gasoline prices to boost their savings.
Why inflation is dictating India’s monetary policy
If the RBI announced a rate cut too early, it would spur consumer spending and send inflation soaring, forcing the central bank to raise the repo rate.
Analyzing the immediate impact of the announcement by the RBI
The Reserve Bank of India (or RBI) is India’s central bank. It maintained the status quo on its key rates in its fifth bi-monthly monetary policy statement. The statement was released on December 2, 2014.
India’s Consumer Price Index Is Tethered but Risky
The RBI had headroom to make a further rate reduction in August, but then the bank resisted, citing the rise in core inflation.
Why India’s industrial production is very volatile
Although volatility isn’t necessarily a problem, it makes it difficult for the government to make concrete decisions for industries. However, the government is determined to give the manufacturing sector a push.
How Consumer Staples Saved the Aberdeen Latin American Equity Fund Class A in September 2015
The Aberdeen Latin American Equity Fund Class A fell by 6.3% in September from August. But between September and October 28, the fund has risen by 6.0%.
Why the Matthews Japan Fund Was the Best-Performing Fund in 2015
The Matthews Japan Fund – Investor Class (MJFOX) fell 0.4% in December 2015 from the previous month. In the three- and six-month periods ended December 31, the fund rose 10.4% and fell 1.2%, respectively.
Do Crude Oil Prices Hold the Key to a Rate Hike in the US?
Cushing, Oklahoma WTI prices fell to $41.93 a barrel on August 17—the lowest since early March 2009. Iran flooding the market with its oil is one of the reasons for this fall.
Advance retail sales for December 2014 were disappointing
Markets were disappointed by the weak retail sales report. Estimates for advance retail sales were $442.9 billion in December 2014.
Why did consumers’ confidence rise in December?
The Board’s Consumer Confidence Index rose to 92.6 in December—compared to 91 in November. For November, the index was revised from an initially reported value of 88.7.
How Should You Approach Investing in Europe-Focused Funds?
The financials sector continues to be the top-invested sector, with four of the 12 funds choosing it as their most preferred sector. However, the number of funds choosing financials is down from six in the previous quarter.
Financials Dragged FLFAX Year-to-Date through November in 2015
FLFAX fell 2.8% in November 2015 from a month prior. In the three- and six-month periods ended November 30, the fund fell 4.8% and 20.4%, respectively.
Kocherlakota’s thoughts about monetary policy stimulus in 2015
Kocherlakota asked “Should the fed funds rate target range be raised soon?” He thinks it will be a few years before PCE inflation returns to the target.
Consumer prices still deflated by gasoline
In the 12 months leading up to January, prices fell 0.1%, the first decline since October 2009. In December, consumer prices rose by 0.8% year-over-year.
The Vanguard PRIMECAP Fund Portfolio through November 2015
Information technology and healthcare are the top two sectors. Together, they command slightly less than 65% of the Vanguard PRIMECAP Fund’s assets.
Why Unemployment Worries Have Reduced
Job additions, which had scared policymakers and market participants alike with the downward revision for April and dismal additions in May, seem firmly back on track.
The US Economy Has a Hiccup—Hopefully Just One
The second estimate from the Bureau of Economic Analysis (or BEA) showed that gross domestic product (or GDP) growth for the US economy slowed to 2.2%.
Outflows Continue in High-Yield Bond Funds: Week to June 19
Last week, investor flows in high-yield bond funds remained in negative territory for the second week in a row. They’ve witnessed inflows of $2.6 billion YTD.
Why Isn’t the Fed Worried about the Unemployment Rate?
Some FOMC participants thought that the unemployment rate was close to or below what they assessed to be the long-term normal rate.
Why the September FOMC Meeting Was a Close Call
The September FOMC (Federal Open Market Committee) meeting had surprised market participants with three dissenting votes.
Weak Showing by Top Sectors Led to a Forgettable 2015 for FKGRX
The Franklin Growth Fund – Class A (FKGRX) fell 2.0% in December 2015 from a month ago.
What worries Charles Evans?
A slowing global economy is also a worrying factor for Charles Evans. Companies with an export focus will hire fewer people if there are fewer orders.
The EP Latin America Fund A (EPLAX): Historical Portfolio Overview
The EP Latin America Fund Class A invests in companies that derive “at least 50% of its revenues or profits from business activities in Latin America.”
Outflows Resume for High Yield Bond Funds
Investor flows in high yield bond funds returned to negative territory last week, after having seen inflows in the previous week.
What Bond Mutual Fund Investors Can Do in a Liquidity Squeeze
Things look fine for now Previously in this series, we discussed how mutual funds have a notably larger holding of corporate bonds at present than they had before the financial crisis of 2008. We’ve also talked about how regulatory changes could impact the role of banks as market makers. At the same time, the role […]
Inflows Return to High Yield Bond Funds in the Week to June 5
Investor flows in high yield bond funds were in positive territory last week.
Why Are Market Participants Concerned about December 2015?
The addition of “at its next meeting” in the FOMC’s October statement has led market participants to believe that a rate hike may be effected in its December meeting.
Job Reports Drive Up Treasury Yields
US Treasury yields moved uniformly upwards across the yield curve in the week ended June 5, 2015.
Is US Economic Growth Satisfactory in the Eyes of the Fed?
From the perspective of monetary policy, a strong rate of economic growth is required for a central bank to tighten policy.
Can ‘Patience’ Give Way to Something Else in March 2015?
The FOMC will meet for its next scheduled meeting on March 17–18, 2015. Markets will be watching for a change in the language of the FOMC’s forward guidance.
Inflows into Investment-Grade Bond Funds Increase Last Week
Investment-grade bond (AGG) funds saw net inflows of $1.53 billion in the week ending May 1, 2015.
What Rate Hike Road Is the Fed Really on in 2016? (It Looks Strangely Like 2015)
Policymakers are now hinting toward a rate hike in June. But markets seem to be feeling otherwise.
Leveraged Loan Fund Outflows Reach Highest Level Yet in 2015
According to Lipper, leveraged loan funds saw outflows for the week ended August 19, making it the fourth such successive week. The quantum of outflows was $754 million, the highest so far in 2015.
Third Avenue Focused Credit Fund Liquidated: Concerns for Others?
On December 10, 2015, Third Avenue Management announced that redemptions were barred from the Third Avenue Focused Credit Fund (TFCVX) (TFCIX).
Bank of England Stands Pat on Interest Rates
The Bank of England decided not to cut its interest rates to new record lows when it met on July 14, 2016. The country’s central bank was under pressure to act.
A Dovish Federal Reserve and US Equity Mutual Funds
The Federal Reserve has toned down its expectations of US economic growth in 2016, given the state of the global economy. It remains quite confident on the domestic front, though, as projections for the unemployment rate have been reduced.
JPMorgan European Fund’s Performance Shaping Up to Be Forgettable
The JPMorgan Intrepid European Fund Class A has fallen 7.6% year-to-date, making it the worst performer in the group of 12 funds chosen for this review.
What Should Fixed Income Investors Do in Present Times?
What should fixed income investors do today? Generally, widening spreads provide a buying opportunity for investors, because spreads widen when yield of a security rises.
High-Yield Bond Mutual Funds: What to Expect in 2016
If you’re a moderate investor invested in high-yield bond mutual funds, you could consider moving some of your assets to investment grade funds (OPIGX).
Developing a Strategy for Investing in Latin America Funds
In this series, we’ve reviewed seven LatAm-focused mutual funds (BDERX) in terms of their sectoral changes over the past year and the possible reasons for their performances in 2016.
How the Hennessy Japan Fund Investor Class Fared in September 2015
The Hennessy Japan Fund (HJPNX) dived by 8.2% in September from the previous month—the worst performer in September among the nine funds we’re reviewing.
How to Invest in Singapore Equities
Leading the ETF pack for investing in Singapore equities is the iShares MSCI Singapore ETF (EWS).
The Eurozone Economy in 2016 and Beyond: World Bank Projections
Inflation remains a concern for the Eurozone. The World Bank said that though deflation concerns have reduced in 2015, they have not gone away completely.
BlackRock Shares Its Views on Fixed-Income Strategy for 2016
BlackRock is not upbeat about fixed income in 2016. It’s more optimistic about stocks than it is about bonds, specifically European and Japanese equities.
FOMC Meeting Minutes: What Does It Mean for Your Investments?
Most members of the FOMC want to move cautiously in regards to rate hikes. They expect the factors that are holding down growth to only give way slowly.
How the EP Latin America Fund Class A (EPLAX) Avoided Major Losses in August
The EP Latin America Fund A (EPLAX) fell by 8.4% in August 2015, from July 2015—the second smallest decline among the eight funds in this review.
What Is the Outlook for Europe-Focused Mutual Funds?
In this series, we have reviewed ten Europe-focused mutual funds in terms of their sectoral changes over the past year and the possible reasons for their performance in 2015.
Growth in Japanese Housing Starts Slowed in July 2015
Japanese housing starts rose in July 2015, but their pace slowed compared to a month ago. Housing starts rose by 7.4% in July compared to a year ago.
Direct bids for the 4-week Treasury bills auction dropped sharply
The US Department of the Treasury conducted the weekly auction for four-week, or one-month, Treasury bills (BIL) (MINT), or T-bills, on January 21.
Could Investing in Asia-Pacific Give You an Edge?
The Asia-Pacific region provides radically different investment opportunities in one region. It will be very hard for another region to provide the diversity of Asia-Pacific.
Inside the Fidelity Growth Company Fund Portfolio
FDGRX’s core sectors are information technology, consumer discretionary, and healthcare. The first two sectors make up a little over 60% of the portfolio.
The EP Latin America Fund Class A (EPLAX): Must-Knows
Euro Pacific Asset Management offers the EP Latin America Fund A (EPLAX), which aims for capital appreciation by investing “at least 80% of its net assets.”
The US Economy: Fischer and Brainard Weigh In
Stanley Fischer expressed his views on the US economy at the G30 Annual International Banking Seminar on October 11. This came three days after the dovish minutes of the FOMC September meeting.
Inside the Portfolio Changes of the Fidelity Growth Company Fund so Far in 2016
FDGRX’s assets were invested across 398 holdings as of June 2016, when it was managing assets worth $36.6 billion as of the end of June.
What Has Hurt the JPMorgan Growth Advantage Fund in YTD 2016?
VHIAX stands tenth among the 12 funds chosen for this review. In the one-year period, the fund placed dead last among its peers.
Are You Thinking about Diversifying Your Portfolio?
Geographical diversification allows your portfolio to keep earning returns in case your primary geography has not been doing well.
What Should You Expect from Monetary Policy Announcements?
Most FOMC participants indicated that they preferred to consider a possible rate hike on a meeting-by-meeting basis—without providing any hints about the timing of a rate hike.
How to Invest in US Large-Cap Equity Mutual Funds Going Forward
Mutual funds follow a bottom-up research approach. They focus on companies rather than macroeconomic and sector trends.