Last year an infamous cryptocurrency ad featured the slogan “fortune favors the brave.” And while historically fortune does favor the brave, there is a difference between courage and blind faith.
During the holiday season, everyone is looking for a good deal. While searching by the highest percentage discounts seems like it may lead to a steal, the results tend to be underwhelming. Investors often make the same mistake during bear markets.
2023 may be another difficult year for investors who hope to relive the speculative markets of 2020 and 2021.
Remember, the Fed hikes short-term interest rates to slow long-term growth and inflation.
One of the reasons we formed RBA in 2009 was we thought the US was entering perhaps the biggest bull market of our careers.
It has always been important to separate one’s political views from one’s investment portfolio.
Investors see a myriad of unknowns right now, and popular discussion continues to focus on a dichotomy between growth and cyclicals. We think there is a third choice that's being ignored.
We more than doubled our portfolios’ duration in a single day this summer.
Bubbles don't deflate overnight and bear markets always signal a change in leadership, yet investors appear eager to jump back into owning prior cycle winners.
It’s time for our annual August report, “Charts for the Beach.” Each year we highlight five of our favorite charts we think consensus is currently overlooking. Load up the cooler, get your towel and chair, and enjoy the charts! And, watch out for those sharks!!
We’ve all heard the famous Yogi Berra quote, “Nobody goes there anymore. It's too crowded.” Investors today seem jazzed up on an opposite but similarly absurd concept: Wall Street thinks it’s a huge buying opportunity because everybody’s too bearish. In his latest Quick Insight, Dan Suzuki analyzes explains seven signs that suggest that investors have yet to capitulate.
Global liquidity has tightened dramatically this year, which may be a headwind to global equity markets. However, not all central banks are tightening because not all countries have an inflation problem. Our latest research insight explains why we think Japan and China warrant a closer look.
The investing world seems highly uncertain these days. Investors are understandably having trouble balancing earnings, the Fed, fiscal policy, inflation, economic growth, disease control, and geo- and US politics. Read our latest report to learn about the two certain events that are central to our current portfolio positioning.
Given year-to-date fixed income returns, one would be forgiven if they never wanted to own the asset class again. Such a view, however, could prove costly as, for the first time in a year, areas of the market are starting to look attractive.
Bear markets always signal a leadership change within the overall equity market. The leadership going into a bear market is rarely, if ever, the leadership coming out. Because of this rule of thumb, we view bear markets as periods of extreme opportunity.
In our latest insight, we analyze the recent DALBAR study to determine how well (or not well) active fixed-income investors performed during the bull market and explain what we believe will be the best approach for fixed-income investing given the start of a pro-inflation paradigm shift.
To start, let’s discuss what diversification is and what it is not.
The global economy seems to be significantly changing, yet investors remain very hesitant to alter their basic portfolio strategies. As they did around 2010, investors are using the old leadership as their portfolios’ core. We think this could be a mistake.
The 2s10s curve is once again knocking on the door of becoming inverted (while some curves like the 3s10s and 5s10s already are), causing quite a stir among market watchers that recession is imminent. In his latest report, Michael Contopoulos examines the 2s10s yield curve movement leading up to the past 6 times the US economy slipped into a recession and discusses what could be different this time.
With the sell-off in bubble assets beginning to broaden out and accelerate this year, many pundits are suggesting the bubble has already deflated.
We all love alliteration (hence, Rich’s favorite term to describe the Fed is “lily-livered”) but when it comes to the “Powell Put” or the “Powell Pivot,” we think investors need to understand the facts and intentions of the Federal Reserve before accepting a saying just because it rolls smoothly off the tongue.
Investors have been spoiled by the trend in falling long-term interest rates over the past 40 years, but the economic backdrop is changing. Read our new report where we explain the concept of equity duration and analyze how interest rates, earnings, and the relationship between the two can impact equities.
In October, we published analysis demonstrating why it’s never too early to sell a bubble. Unsurprisingly, investors still seem reluctant to reduce their bubble exposure, preferring instead to move up in bubble quality.
In his latest report, Dan Suzuki shows that when a bubble collapses, everything in it goes down, including proven leaders and tomorrow's winners, regardless of valuation, beta or quality. Thus, the only way to protect from a bubble is to get as far away from it as you can.
While the Fed has now dropped "transitory" from their communications, the US and global economies might indeed be in a transitory state, and the important investment question is transitioning to what? It seems highly unlikely the economy will return to its pre-pandemic state. In our year ahead outlook report, we highlight our views on the best investment opportunities for 2022, given our analysis of an economic transition during the coming year.
With inflation surprising to the upside and lasting longer than most expect, we believe investors will need to rethink portfolio management and what it means to own a balanced portfolio. Michael Contopoulos's latest report addresses investors' many questions related to our view on inflation and its implications for the future.
Investors become myopic during bubbles. As we’ve repeatedly highlighted, it is exactly that narrow-mindedness that presents opportunities because investors ignore the broad range of potential investments outside the bubble. In this report, we outline the opportunities available outside of today's bubbles and analyze the fundamentals that support our views.
When it comes to RBA's view that we're in a bubble, investors seem to fall into two camps- "duh" and "you just don't get it." But recognizing the bubble is only the first step in dealing with the bubble. In his latest report, Dan Suzuki analyzes historical performance data from the 2000 Tech Bubble to determine how early is too early to reduce exposure to bubble assets.
We have become famous (or infamous) regarding our views that there is a bubble in long-duration assets. In this report, we investigate what’s causing such widespread bubbles, their potential effects on the overall economy, and the interesting investment opportunities resulting from the bubble’s misallocation of capital.
Investors are increasingly looking outside developed countries for investment opportunities, but it’s important to remember that not all Emerging Market countries are the same. In this report, we compare the opportunities in China & Brazil.
The global economy is changing, yet many investors seem to have static portfolios. RBA explains why we believe the current shift in market leadership will last longer than investors are expecting.
With very low inflation expectations for this year, Rich analyzes the shifts in the global and US economies that could impact inflation and explains how to position your portfolio for this change.
Read our year-ahead report to learn how this shift could lead to investment opportunities in 2021 and to understand RBA's positioning.
In RBA’s latest report, Rich revisits the "Earnings Expectations Life Cycle" from the perspective of growth versus value investors and outlines why growth investors need to be contrarians in 2021.
This year our annual summertime report, “Charts for the Beach”, visually highlights newsworthy issues that aren’t yet in the news.
Black swans are swimming in flocks. We highlight today’s biggest black -and white- swans that can hurt -or help- your portfolio.
Coronavirus is a global pandemic that few if any could have predicted, but it’s deteriorating fundamentals throughout 2019 into 2020 that set the table for the recent extreme market volatility. Now that volatility has clearly arrived, what‘s the strategy when black swans swim?
Every instance of financial speculation today is termed a “bubble”, but true financial bubbles are rarer than most investors believe and they go beyond the financial markets and pervade society.
Throughout this 10-year bull market, investors have been overly cautious toward equity markets and ignored “new highs”. Now in this late-cycle market environment, investors are piling into cyclicality, private equity and venture capital. It’s time to stop saying everyone is so bearish.
Smoke detectors and fire extinguishers are critical safety devices. But investors in every cycle ignore the markets’ warning signals regarding risk. Rather than ignore the warnings, we are dusting off and priming the traditional portfolio “fire extinguishers”.
Today’s markets are experiencing decreasing liquidity amid increasing volatility. To stay ahead, investors must adapt their strategies to the ever changing market environment and learn to invest like a chameleon.
Unprecedented market uncertainty is leading many investors to focus on the markets more than ever, but are they focusing on the right things? For our annual August report, Charts for the Beach, we highlight 5 charts that consensus is currently overlooking.
All too frequently investors use the rear-view mirror to determine an investment’s attractiveness. An upward sloping price chart often automatically makes a stock more attractive. Recent performance helps determine a “good” manager. Past interest rate movements can cause changes to bond portfolio duration.
One wayward tweet can send the markets spiraling in the short term, but RBA knows that in the long term, profits determine the direction of the markets, not politics.
Investors remain fixated on longer-duration bonds even as their risk increases. Duration is a measure of risk and myopically focusing on the long end of the curve while it appears to be significantly overvalued may prove fruitless.
Investors have remained on the sidelines for most of this 10+ year bull market, yet FOMO is leading many to join the party late. In this late cycle environment, one should consider sobering up before the punch bowl is taken away.
Investors’ current enthusiasm for piling money into next great tech unicorn is ominously reminiscent of March 2000. Might we be doomed to repeat the Tech Bubble?
The Fed’s constant balancing act between easing and tightening monetary policy is intended to influence banks’ lending habits, but as the old axiom goes; you can lead a horse to water, but you can’t make it lend.
RBA’s unique Pactive® investing approach has made us one of the largest and fastest growing ETF model managers in the United States. But we don’t choose our ETFs at face value. Instead, we treat each ETF as a portfolio before making our selections. Learn why our ETF “x-ray” approach is critical for our investment process.
We think it’s better to position our portfolios based on 2019 fundamentals than structuring them by looking backward at December 2018’s volatility.
Public policy can be corporate-friendly or corporate-unfriendly. But what if it’s corporate-uncertain? Then investors are faced with volatility. Part I of our Year Ahead investigates the current corporate-uncertain environment.