After a year that saw the S&P 500 Index return more than 20%, QMA predicts stocks will again outpace bonds in 2018 — potentially by a very wide margin. While QMA's base case, outlined in its 2018 Outlook & Review "Goldilocks Growth and the Missing Bears," calls for S&P returns in the 10% range, the firm envisions scenarios that could have 2018 nearly matching 2017's surprise breakout year for equities.
The success of the most far-reaching U.S. tax overhaul in decades will depend on whether American companies invest their tax windfall on expanding hiring and production capacity or save it for dividends and share buybacks that, while they increase shareholder value, do little for economic growth, according to three PGIM thought leaders.
NEWYORK, Dec. 05, 2017 - Jennison Associates announced today that Loraine “Lori” McEvoy will join the firm as their global head of distribution, effective Dec. 15, 2017. The new role, which combines oversight of all of Jennison’s client-facing sales and servicing activity, will include responsibility for institutional, subadvisory, and retail distribution; consultant relations; and client service. McEvoy will report to Jeffrey T. Becker, Jennison’s chairman and chief executive officer.
NEWARK, N.J., Oct. 9, 2017 - Adam Broder will join QMA as head of Global Distribution, a new role that combines oversight of all client-facing activity for the first time. In this capacity, he will lead a team to extend new global capabilities in client and business development.
“Democratization of returns from capital markets is starting to erode. Until the fundamental problems of public markets are addressed, fast growing companies will continue to grow privately, and retail investors will not have access to as many high-growth companies.” - David Hunt, President and Chief Executive Officer, PGIM
NEWARK, N.J., Sept. 11, 2017– George N. Patterson will join QMA’s investment team to co-lead a unified Global Equity Platform, aligning the firm’s U.S. Value, U.S. Core and Non-U.S. Core investment strategies under one leadership team. The new platform will allow QMA to refine and customize products in response to the needs of its global client base, consistent with its long-term, research-led investment philosophy.
Since the financial crisis, investors have enjoyed generally benign conditions, with subdued volatility and strong markets, but active equity managers have remained under pressure. This should not be surprising; history has shown a strong pattern of counter-cyclicality in manager excess returns relative to the equity market. The Impact of Market Conditions on Active Equity Management takes a close look at the relationship between equity market conditions (defined by market returns, volatility, and dispersion) and active equity manager results.
Of all the variables the new U.S. administration brings for investors, one of the trickiest to plan for is inflation. Inflationary pressures were already building before the election ushered in the prospect of a sweeping agenda of pro-growth fiscal and de-regulatory policies. QMA says one common way to hedge against inflation is to diversify portfolios with exposure to real assets. In Some Like it Hot, QMA analyzes historic returns during normal and above-average periods of inflation and makes the case for an allocation to real assets.
In the search for alpha, small-cap stocks are regularly viewed as one of the markets’ most fertile sources compared to larger capitalization stocks. Across every geographic market, the median outperformance of active small-cap managers relative to their respective benchmarks over the last five years is significantly higher than for large-cap managers.
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