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Investing Ideas
A Potential Turning Point in the Battle Against COVID-19
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Delivering better-than-expected trial data, a vaccine candidate from Pfizer and BioNTech could mark the beginning of the end of the pandemic and boost confidence in an economic recovery, now underway.
Investing Ideas
Evaluating Stocks as Growth Continues to Grow
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Portfolio Manager Doug Rao discusses the phenomenon of concentrated market leadership and what that means for long-term investors.
Key Takeaways
- When market returns are driven by a handful of stocks, active investors face difficult decisions, especially when underweighting or not owning these stocks may significantly impact portfolio performance.
- The recent phenomenon of large-cap tech stocks driving a significant portion of stock market gains may be justified by the fact that these companies are strongly tied to themes related to digital disruption.
- Investors may benefit from focusing on competitively advantaged companies positioned to profit from these themes, which have only accelerated amid the COVID-19 pandemic and are likely to persist over the coming months and years.
Investing Ideas
Sustainable Design in Consumer Products
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An in-depth look at the role of sustainability in consumer products.
Key Takeaways:
- The apparel sector is well known for its detrimental effects on the environment. However, as consumers become more aware of their own environmental footprints, there has been a surge in demand for sustainable goods.
- A circular economy is based on the principles of designing out waste and pollution, keeping products and materials in use, and regenerating natural systems.
- Companies including Nike, Adidas and DS Smith have incorporated a circular approach to the design and production of their goods, creating durable and long-lasting products with a reduced environmental footprint.
Policy and Regulatory Commentary
COVID-19 isn’t going away
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Colossal policy responses in the second quarter reassured investors that the U.S. economy can weather the COVID-19 downturn, with a relatively quick return to risk assets pushing the S&P 500® up 20.5% for the period, its best quarter since 1998. After bottoming in March, U.S. stocks rose as much as 44% before the rally stalled a bit over the last few weeks of the quarter. We saw a few signs of hesitation for more policy among lawmakers as indicators improved, but overall both Congress and the Federal Reserve (Fed) remain prepared to do more.
Policy and Regulatory Commentary
The U.S.-China relationship in a changing global economy
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An inevitable blame game between the U.S. and China has followed COVID-19, but the crisis has really just extended the “trust deficit” that has been steadily building between the two countries in recent years. Though the “Phase One” agreement between the countries remains intact, it is very fragile and China is turning to a more domestic focus. The U.S.-China relationship, however, remains pivotal for the global economy, and in our mini-forum devoted to the topic, we began with a discussion of the relationship from China’s perspective.
Policy and Regulatory Commentary
U.S. presidential election outlook
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As the 2020 election season heats up and President Trump’s odds of winning continue to run cold, we believe it is important to understand the investment implications of a potential change in government versus the status quo. We have outlined the policy implications of the three most likely election outcomes: a Democratic sweep, a Biden presidency with a Republican Senate and a Trump presidency with a Republican Senate. This analysis assumes that Democrats hold the House, which we believe is highly likely.
Policy and Regulatory Commentary
Is this the new normal?
Pyrford International provide a snapshot of the UK economy as it inches closer to Brexit.
Investing Ideas
Combining Factors to Target Specific Investment Outcomes
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A white paper that explores using a factor-based approach to portfolio construction. By combining factor exposures, investors can create a "core" equity portfolio and by adjusting the factor allocations can tailor their portfolios to their own particular investing style/desired outcome.
Investing Ideas
DOL Fiduciary Rule is All but Gone
In the most recent edition of Washington Insights, we discussed the latest — and likely final — chapter in the DOL fiduciary rule saga. On March 15, a three-judge panel of the Fifth Circuit Court of Appeals voted to vacate (or nullify) the rule.
Investing Ideas
Are Markets Pointing Toward a Value Resurgence?
Read the Invesco Strategy Insights white paper that summarizes historical inflection points and offers key takeaways for the future.