The domestic equity markets returned to a more risk-on posture from the more defensive tone of the previous month. Interest rates were cut for a third consecutive time, planned tariffs on Chinese goods were postponed, and Brexit was delayed for another three months.
Last Friday, October 25, was a big day for bitcoin, rallying as high as 42% and closing out the day up almost 30%. This was the third-largest, single-day run-up in bitcoin’s history! The strong price appreciation came on the back of comments from Xi Jinping, president of the People’s Republic of China, on the potential of blockchain technology, stating that China needs to “seize the opportunity… and accelerate the development of blockchain technology…”1
With literally hundreds of sources of news and information at our fingertips these days, it is easy for the average investor, and many investment professionals, to be overwhelmed by all of the data and opinions they are bombarded with every day. And yet, for all the information available to the US investor, very little focuses on opportunities outside of the US, and only a fraction of that is on emerging markets.
Funds that focus on environmental, social, and governance (ESG) advancement attracted about $8.9 billion worth of net inflows during the first six months of the year, according to data from Morningstar. That is more than a 60% jump from the $5.5 billion in inflows for all of 2018.
We learned in Finance 101 that beta is a metric designed to gauge sensitivity. A stock with a beta of 1.50 relative to the S&P 500 Index should, on average, gain or lose $1.50 for every $1 gained or lost by the index.
September lived up to its reputation of being one of the most eventful months of the year, from both a monetary policy and geopolitical headlines perspective. Political discord, trade rhetoric, and the Federal Reserve’s (the Fed) policy comments on future rate cuts contributed to an interesting environment during the month.
Investors traditionally have had an appetite for yield. Sitting back and collecting a quarterly payment from doing nothing more than making an initial investment is attractive, especially to retirees or those depending on a consistent stream of cash flow.
Stop for a moment and imagine the year is 2100, the world has been fossil-fuel free for two decades, flying cars are at the cusp of attaining commercial viability, and Wall-E 1.0 has just been released. And now remember your government still has 19 years left on the ultralong, 100-year bond it issued in 2019.
On the morning of September 14, 1814, Francis Scott Key penned the first verse of The Star Spangled Banner on the back of a letter as he watched with pride as a group of US soldiers raised the American flag over Fort McHenry a day after more than 24 hours of continuous bombardment by the British. For the history buffs among us, the battle was a critical victory in the War of 1812 that began, somewhat ironically, given the current state of affairs with China, over a trade war with Britain.
The domestic equity markets were roiled in August by the trade war between the US and China. The announcement of another round of higher tariffs on Chinese goods at the beginning of the month was quickly followed by an increase in the tariffs on US goods entering China. The Trump Administration responded with even higher tariffs on virtually all Chinese goods.