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Synthetic CDOs: Back in vogue but not without risk 

Fixed Income , Risk Management

As credit spreads have gradually declined, investors have increasingly been focusing their attention on more complex instruments including synthetic Collateralized Debt Obligations in the search for yield. However, the risks of these investments — including the senior tranches — should not be overlooked.

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Looking to the futures of emerging markets 

Global Investing , Risk Management , Economic Exposure , Emerging Markets

Emerging-market (EM) equities have delivered unique risk and return characteristics over the last 30 years. Are futures on EM stocks a liquid enough means to gain exposure during normal and stressed conditions?

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Has global sovereign rates momentum headed in reverse? 

Risk Management

Momentum can be an important factor in sovereign-rates markets. But investors concerned with exposures to short-term rate movements in global bond markets may wish to ask themselves whether the trend is indeed their friend.

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Emerging markets since China A shares’ inclusion 

Global Investing

The emerging-market (EM) equity segment has evolved substantially during the two and a half years since MSCI announced the inclusion of China A shares in the MSCI Emerging Markets Index.

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The value of standards in the investment process 

Global Investing , Factor Investing , Risk Management

Standards can establish a common language and provide clarity among market participants. We examine three to see how they can help evaluate returns, quantify factor exposures and measure the impact of changes in sector and industry trends.

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Are EU corporate bonds all alike? 

Economic Exposure , Fixed Income , Risk Management

The integration of the eurozone’s economy may tempt investors to view corporate debt issued by European companies as undifferentiated. On average, this view has seemed correct — but not always durings times of market stress.

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Digging deeper into pan-European property funds’ performance 

Real Estate Investing , Risk Management

Property investors who invest across a broad region, like Europe, can use a peer-group benchmark to gauge relative performance. But to determine the specific drivers of returns, detailed asset-level performance attribution can help shed light.

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Factors behind value’s underperformance 

Factor Indexes , Factor Investing , Factors

As the relationship between U.S. value factors’ exposures and returns deteriorated over the last decade, U.S. momentum’s return patterns improved. We examine the value-momentum relationship and contributions of other style factors to value’s performance.

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Something for nothing? Increasing bond duration may not increase portfolio risk 

Fixed Income , Risk Management

Asset allocators may consider lengthening the duration of their bond portfolios to prepare for a potential recession in the U.S. But could duration extension push risk above target thresholds? Maybe not.

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Did insider transactions have secrets to tell? 

Factor Investing , Factors , Risk Management

Company insiders’ trading of their company’s stock is usually subject to strict rules, including public disclosure. Did observing insider transactions provide more information about expected company performance than traditional sources?