1. BLOG

    EU Taxonomy Reporting Has Perplexed Issuers 

    Sep 26, 2023 Nakul Jadhav , Amandeep Kaur

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    Although the EU Taxonomy is a pivotal framework for assessing sustainability in economic activities, it remains a source of confusion. Its correct interpretation will be key to ensure that data is properly disclosed and reporting obligations met.

  2. BLOG

    Biodiversity and Business: Are Companies Aware of Nature’s Risks? 

    Sep 25, 2023 Shitiz Chaudhary , Arne Philipp Klug

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    Although corporate disclosures around biodiversity- and nature-related risk vary, with growing stakeholder awareness and initiatives such as the TNFD framework, we may see a move toward more standardized disclosures that could help investors better assess these risks.

  3. BLOG

    What’s Been Driving the Carbon Footprint of MSCI’s ESG Indexes? 

    Sep 22, 2023 Xinxin Wang , Manish Shakdwipee , Guido Giese

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    We analyze the index-level carbon emissions of the MSCI ACWI, ACWI ESG and Socially Responsible Investing Indexes, in terms of both financed emissions and emissions intensities, to see what the trends are and what’s driving them.

  4. BLOG

    Loss Aversion and Property-Market Liquidity 

    Sep 20, 2023 Tom Leahy

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    Investors do not like to realize losses. We examine the link between this loss aversion — an observed phenomenon in commercial-property markets — and a drop in liquidity in key markets around the globe. 

  5. BLOG

    Biodiversity Funds:
    Welcome to the Jungle 

    Sep 20, 2023 Rumi Mahmood , Shuang Guo

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    Biodiversity is the new kid on the block in sustainable investing, and a lack of harmonization makes it a jungle out there. We assessed how biodiversity-labeled and biodiversity-related funds differed in sector and revenue exposure and performance. 

  6. BLOG

    Engagement Is a Powerful Force in Climate Action 

    Sep 19, 2023 Chris Cote , Harlan Tufford

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    As the urgency of addressing climate change continues to grow, investor engagement could be key to holding companies accountable for their environmental impact and influencing corporate climate strategies and net-zero commitments. 

  7. BLOG

    The Potential Impact of El Niño on Sovereign Debt 

    Sep 18, 2023 Alexander Schober , Cole Martin

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    With a very strong likelihood of an El Niño event forming by the end of 2023, we take a look at the impact such events have had in the past on the debt-to-GDP ratios of global sovereigns and what this could mean for impact investors.  

  8. BLOG

    Better Incentives Could Quicken a Return to the Office 

    Sep 15, 2023 Jim Costello

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    Office vacancy has reached a record high for properties in central business districts. Forms of compensation to attract people back to offices could include improved mass transit and reduced travel time.  

  9. BLOG

    Nearshoring, Friendshoring and Reshoring: Heads Up to Equity Allocators 

    Sep 13, 2023 Oleg Ruban

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    Multinational corporations’ recent interest in reconfiguring their global supply chains and adopting “China-plus” manufacturing strategies has potential consequences for equity allocators, reaching across countries, sectors and themes.   

  10. BLOG

    Unearthing Real Estate Trends in Commodity Cities 

    Sep 12, 2023 Bryan Reid

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    Cities that ride booms and busts in commodity prices have in the past achieved strong outperformance in commercial-property returns during booms. Has the recent surge in commodity prices had a similar impact on returns? 

  11. BLOG

    Equity-Factor Commentary July 2023: Fireworks and Froth 

    Aug 25, 2023 George Bonne

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    The risk-on market rally continued in July amid several indicators of frothiness as beta and residual volatility posted the highest factor returns in the U.S. by a wide margin and were also strong globally.

  12. BLOG

    Do Not Fear the Impact of AI on Commercial Real Estate 

    Aug 22, 2023 Jim Costello

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    Worries about artificial intelligence supplanting knowledge workers have created more pain for the office market but a broader view of the impact on commercial real estate is vital. 

  13. BLOG

    Understanding the Drivers of Transition-Risk Climate VaR 

    Aug 18, 2023 Zoltán Nagy , Rob Barnett , Guido Giese

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    Climate stress-testing models like MSCI Climate VaR may be complex, but their main mechanisms can be explained using linear regression. This helps transform input variables into risk outputs, making it easier for investors to understand the primary drivers.  

  14. BLOG

    Insights from Past Concentrated Rallies and Thematic Opportunities 

    Aug 16, 2023 Dinank Chitkara , Rohit Gupta

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    The rally in the first half of 2023 shared some similarities, and had notable differences, with past concentrated rallies. In addition to AI, structural megatrends, such as the blockchain economy and robotics, helped drive the rally. 

  15. BLOG

    Student Housing: Passing Surge or Graduating to the Big Leagues? 

    Aug 15, 2023 Niel Harmse

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    Student housing continues to evolve as a distinct asset type. The sector outperformed the rest of the U.K. residential sector as well as the retail and office sectors over the three, five and 10 years ending December 2022.

  16. BLOG

    AI’s Moment and Insights from Themes Past 

    Aug 9, 2023 Anil Rao

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    Enthusiasm for artificial intelligence has boosted the stock prices of many U.S. technology behemoths this year. How does the AI rally compare to previous market shifts, and what lessons might investors in today's largest firms learn from history? 

  17. BLOG

    Tracking Multi-Asset-Class Portfolios’ Emissions 

    Aug 8, 2023 Xinxin Wang , Zoltán Nagy , Guido Giese

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    Our previous research discussed a framework for investors to attribute changes in equity portfolios’ emissions to their primary drivers. We now adapt it to identify and analyze two approaches to tracking a multi-asset-class portfolio’s carbon footprint. 

  18. BLOG

    Making the Most of Mandatory Climate Disclosures 

    Aug 1, 2023 Rob Barnett , Sylvain Vanston

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    As TCFD reporting grows more sophisticated, investors may be able to use climate data to make meaningful disclosures across their firms. We explore three key topics: choice of metrics, internal consistency and cross-functional applications. 

  19. BLOG

    Climate and ESG Indexes in Focus: Let’s Get Specific 

    Jul 31, 2023 Manish Shakdwipee , Guillermo Cano , Xinxin Wang

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    How did our flagship climate and ESG indexes fare versus the broader market in the second quarter? And how much did constituent companies decarbonize since the quarter before? We delve into the specifics.

  20. BLOG

    Do Agency CMOs’ Financed Emissions Have Duration? 

    Jul 20, 2023 Joy Zhang , Yihai Yu , Anant Bhatnagar

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    The market for collateralized mortgage obligations backed by agency residential mortgage-backed securities is a major source of financing for U.S. homeownership. But what is this market’s total emissions footprint? We use our model to calculate it. 

  21. BLOG

    Small Caps Have Been a Big Story After Recessions 

    Jul 17, 2023 Saurabh Katiyar , Ashish Lodh

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    Some investors are already evaluating opportunities offered by a post-slowdown world. One of these opportunities is small-cap stocks, which have historically outperformed large caps, especially after recessions.  

  22. BLOG

    Breaking Down Financed Emissions for Agency RMBS 

    Jul 11, 2023 Joy Zhang , Michael Ridley , Sara Shen

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    Agency residential mortgage-backed securities (RMBS) finance about 17% of U.S. residential greenhouse-gas emissions annually. We break down that number to help issuers and investors understand emissions sources and drivers behind agency RMBS.  

  23. BLOG

    Uncovering Value in Venture-Capital Growth Markets 

    Jul 6, 2023 Padmakar Kulkarni , Yaonan Zhang , Stuart Doole

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    Valuations proposed for venture-capital (VC) growth companies, frequently used as benchmarks for publicly listed growth stocks, often attract heated debate. Our analysis can offer fresh insight into the valuation of private VC companies. 

  24. BLOG

    The Price Is Right? Real Estate Merits More Measures 

    Jul 4, 2023 Tom Leahy

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    Assertions that there is one “right” measure of pricing for property markets are wide of the mark. We examine an array of data points which shed light on the downturn in prices and liquidity, focusing on the U.K. office market.  

  25. BLOG

    Markets in Focus: Looking Beyond the Rate Hikes 

    Jul 4, 2023 Waman Virgaonkar , Hitendra D Varsani , Juan Sampieri

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    Investors face “sticky” inflation, equity-market concentration and expectations that U.S. interest rates may be higher for longer. We examine recent global-markets trends to help as asset allocators and portfolio managers determine their next move. 

  26. BLOG

    Measuring Sovereign Bonds’ Climate Risks and Opportunities 

    Jun 29, 2023 Alexander Schober

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    Quantifying sovereign bonds’ physical and transition risks may help investors determine the climate resiliency of their portfolios. MSCI Climate Change and Natural Hazards Risk Factor Score may help guide the analysis of these complex risks. 

  27. BLOG

    Exploring Factor Investing in Emerging Markets 

    Jun 27, 2023 Anil Rao

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    Following up on a recent MSCI survey that revealed uncertainty among investors about the comparative risk-and-return benefits of EM and DM factor investing, we simulated the performance of six common EM factor indexes over the last two decades.  

  28. BLOG

    The Fed's Pilot — Are Banks Prepared for the Climate Transition? 

    Jun 27, 2023 Carrie Wang , Sita Subramanian

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    Regulators around the world are focusing on climate-related scenario analysis to assess banks’ climate-risk exposure and their preparedness for the low-carbon transition. We look at the Fed’s pilot to see how the six biggest U.S. banks stack up. 

  29. BLOG

    Mapping Extreme-Heat Costs for the World’s Largest Cities 

    Jun 21, 2023 Mathew Lee , Anna Gevecke

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    As temperatures rise, so do the risks from extreme heat. Using hazard percentiles compared across climate scenarios, we assess the cities and sectors that could be most impacted and the costs they could face. 

  30. BLOG

    Agency MBS Are Going Social 

    Jun 20, 2023 Yihai Yu , László Ábel Somlai , Ning Qiao

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    Fannie Mae and Freddie Mac have begun disclosing socially focused borrower data for all pools of U.S.-agency mortgage-backed securities. How can that data inform MBS investors’ models for prepayment risk? 

  31. BLOG

    How Making US Mortgages Portable Could Impact MBS Investors 

    Jun 14, 2023 David Zhang , Yihai Yu , Joy Zhang

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    U.S. mortgages are generally not portable. While there would be legal hurdles to overcome to reverse the situation, such a move could benefit not only homeowners, but potentially investors in mortgage-backed securities. 

  32. BLOG

    The Futures of Climate Action Is Now 

    Jun 7, 2023 Dinank Chitkara , Hitendra D Varsani

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    Derivatives linked to climate investing are in the early stages of product innovation and investor adoption. We compared the impact, financial risk and opportunity metrics for futures on the MSCI Climate Action Indexes.  

  33. BLOG

    The Struggles of Sweden's Property Market 

    Jun 5, 2023 Tom Leahy

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    Higher lending rates have hobbled commercial-property investment in one of Europe’s larger markets. We use multiple data sets to assess the impact on listed companies and the trading of assets. 

  34. BLOG

    Looking for Loan Trouble 

    Jun 2, 2023 Jim Costello

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    The timing of loan maturities could be key to determining which areas of U.S. commercial real estate may face trouble refinancing. We look at the markets for Manhattan offices and Dallas apartments to paint the picture.  

  35. BLOG

    EU Taxonomy: Is There Sustainable Gas-Fired Power Generation? 

    May 31, 2023 Hanna Trueb , Kenji Watanabe

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    Just how much impact will the inclusion of gas in the EU Taxonomy have on the reported-level of EU Taxonomy-aligned revenue in portfolios? Gaps in company disclosures and the stringency of requirements suggests it could be minimal.

  36. BLOG

    Tracking a Corporate-Bond Portfolio’s Emissions Over Time 

    May 30, 2023 Xinxin Wang , Zoltán Nagy , Guido Giese

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    Several factors can drive the changes in a corporate-bond portfolio’s emissions. Our framework helps disentangle these variables and provides investors with greater clarity into their climate-aware strategies. 

  37. BLOG

    Style Bets, Not Stock Picks, Drove Returns in 2022 

    May 25, 2023 Abhishek Gupta , Naoya Nishimura

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    In 2022, unlike in the prior two years, stock selection took a backseat to style factors and industry bets as performance drivers. Top-performing funds gained from all three exposures, while bottom-performing funds lost on all counts.

  38. BLOG

    Capital for Climate Action Conference: Key Takeaways  

    May 22, 2023 Oliver Marchand , Chris Cote

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    MSCI’s Capital for Climate Action Conference brought together leaders from a diverse group of global organizations to untangle the latest developments in the net-zero transition. Here are some of the biggest takeaways. 

  39. BLOG

    Connecting Emissions Attribution with Climate Action 

    May 16, 2023 Xinxin Wang , Zoltán Nagy , Guido Giese

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    Tracking a portfolio’s carbon footprint can be challenging given the multiple drivers of changes in emissions. Our framework attributes these changes to their primary drivers, including changes in issuers’ emissions, ownership and financing structure.

  40. BLOG

    Has Energy Efficiency Emerged as a Driver of Real Estate Returns? 

    May 12, 2023 Niel Harmse

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    Property investors are increasingly focused on climate change and net-zero commitments. Have investors who “green” their portfolios by acquiring more energy-efficient assets and disposing of higher-emitting ones gained a performance edge? 

  41. BLOG

    The World After COVID-19: Exploring the Market’s Digital Makeover 

    May 11, 2023 Anil Rao , Kumar Neeraj

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    COVID-19 hastened the digital transformation of global equities and increased exposures to other themes. We apply an attribution framework to the MSCI ACWI IMI and offer valuable insights into how these shifts have impacted investor portfolios.  

  42. BLOG

    The CDS Market’s View on US Default 

    May 9, 2023 Andy Sparks , Michael Wang

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    There is growing investor concern that the U.S. could default on its debt obligations. As the debt-ceiling debate heats up, we look at the spreads of credit-default swaps as a measure of the U.S. government’s creditworthiness.

  43. BLOG

    Climate and ESG Indexes in Focus: Sectors Told the Story 

    May 8, 2023 Guillermo Cano , Yuliya Plyakha Ferenc , Manish Shakdwipee , Román Mendoza

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    We review the drivers of performance for ESG and climate indexes over the first quarter of 2023, and investigate the explanatory power of the carbon-efficiency factor over time. 

  44. BLOG

    Macro Scenarios: Soft, Hard or No Landing This Year? 

    May 5, 2023 Thomas Verbraken , Will Baker

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    In the wake of the recent banking turmoil, a soft landing for the U.S. economy now seems less likely than at the beginning of the year. We considered four scenarios and performed a stress test on a hypothetical portfolio of global stocks and U.S. bonds.

  45. BLOG

    Why More Short-Dated Options Did Not Increase Market Volatility 

    May 4, 2023 Dinank Chitkara , Hitendra D Varsani

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    Trading of U.S.-listed options more than doubled in 2022 compared to 2019 — as investors gradually gravitated from monthly to weekly to even daily options over those four years. Some have wondered if this could lead to greater equity-market volatilty.

  46. BLOG

    How Extreme Temperatures May Affect Chinese Companies 

    May 3, 2023 Siyao He , Shuo Xu

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    As temperatures rise in China, comprehensive adaptation and response plans are crucial to mitigate the physical risks of extreme heat. We assess which sectors could be most at risk under both orderly and extreme warming scenarios.

  47. BLOG

    How Sovereigns Have Changed the Green-Bond Market 

    Apr 19, 2023 Afsaneh Mastouri , Bhaveer Shah , Vishakha Pandey

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    Green bonds’ issuance by governments has increased significantly and changed the green-bond universe and its indexes. Investors have had to adjust accordingly.   

  48. BLOG

    Long Story Cut Short in Regional Equity Futures Positioning 

    Apr 12, 2023 Rohit Gupta , Hitendra D Varsani

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    The recent banking crisis startled the credit markets while the broad equity market remained resilient. We analyze net long-short positions as investors adjusted their index futures exposures to adapt to changing market dynamics.  

  49. BLOG

    Assessing Banks’ Risk-Oversight Capabilities 

    Apr 5, 2023 Florian Sommer

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    With the banking crisis raising questions about boards’ risk oversight, we analyze the level of independent risk-management expertise on the boards of banks by region to see how well they may be positioned to navigate the current volatility.

  50. BLOG

    Markets in Focus: Factor Valuations and the New Rate Regime 

    Apr 3, 2023 Waman Virgaonkar , Hitendra D Varsani

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    Global equities and bonds remained volatile in the first quarter of 2023 following a strong start and a bumpy finish due to global banking concerns. We analyze whether factor valuations have adjusted to the new interest rate environment.  

  51. BLOG

    Underwriting the Biodiversity Crisis 

    Mar 27, 2023 Cody Dong , Arne Philipp Klug

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    Some property and casualty insurers already use geospatial analysis in their pricing, claims processing and risk management. Adding a layer of biodiversity data to this analysis may help incorporate biodiversity considerations in underwriting.

  52. BLOG

    CoCo Bonds’ Write-Down Risk Is Real 

    Mar 24, 2023 Gergely Szalka

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    UBS Group AG’s arranged takeover of Credit Suisse AG involved heavy losses for the latter bank’s shareholders. But a more controversial part of the deal is the total write-down of contingent convertible bonds. Could investors have seen it coming?

  53. BLOG

    The Silicon Valley Tantrum 

    Mar 23, 2023 Hamed Faquiryan

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    The past week’s change in the slope of the Treasury yield curve was its most rapid in decades. Investors may wish to contemplate the two most recent examples of such swift steepening: the 2008 global financial crisis and 2020 COVID-19 market crisis.

  54. BLOG

    What Could Yield Curves Tell Us About Bond Values? 

    Mar 22, 2023 Michael Hayes

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    A corporate bond’s yield curve is similar to the well-known Treasury yield curve. Could the deviation of a corporate bond’s yield from the yield curve, or mispricing spread, be a useful signal for credit investors?

  55. BLOG

    A New Era for the Bank of Japan? 

    Mar 15, 2023 Naoya Nishimura

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    Haruhiko Kuroda is stepping down after a decade as governor of the Bank of Japan, and the soon-to-be-appointed Kazuo Ueda has the potential to shake things up. What could the new regime mean for investors?

  56. BLOG

    How Could China’s Reopening Impact Global Stocks? 

    Mar 14, 2023 Thomas Verbraken

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    China’s reopening from COVID-19 lockdowns has led to the recent outperformance of the Chinese equity market. We used companies’ economic-exposure data to assess the reopening’s impact on global equities with large revenue exposure to the country.

  57. BLOG

    MBS Valuation and Risk Management Under SOFR 

    Mar 13, 2023 Yihai Yu , Zhi-Guo Huang

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    With LIBOR’s imminent cessation, the transition from LIBOR to new benchmark the secured overnight financing rate (SOFR) is entering a new stage. We analyze the potential impact on valuation frameworks and hedging practices for mortgage-backed securities.

  58. BLOG

    Real Estate Factors’ Performance: The Financial Crisis vs. Now 

    Mar 10, 2023 Bryan Reid , Niel Harmse

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    As U.K. real estate experiences a pricing correction at record pace, it’s natural to make comparisons to the 2008 global financial crisis. We draw on factors in private real estate to better understand current conditions and give us clues to what may happen next.

  59. BLOG

    Manhattan Office Redevelopment: Still Stuck on Pricing 

    Mar 9, 2023 Jim Costello

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    Sales of Manhattan offices for the purpose of conversion into apartments have been minimal. We look at the barriers deterring redevelopment.

  60. BLOG

    Carbon-Emissions Data to Inform the MBS Market 

    Mar 8, 2023 Michael Ridley , Joy Zhang , Cyril Pecoraro

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    Our state-level analysis of carbon emissions for U.S. residential properties indicates strong regional differences in emissions and their drivers. Such data could improve understanding of emissions from holdings in mortgage-backed securities and property loans.

  61. BLOG

    ESG Factor Returns: 2022 in Review 

    Mar 7, 2023 Xinxin Wang , Guido Giese , Zoltán Nagy

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    Our analysis of ESG factor performance in 2022 suggests that time horizons, as well as specific sectors and regions, may be significant in assessing the return characteristics of ESG portfolios. 

  62. BLOG

    Will the US Government Default? 

    Mar 2, 2023 Andras Rokob , Andy Sparks

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    The debt-ceiling debate has heated up in Congress, and the U.S. government’s ability to borrow could be exhausted sometime between July and September. But what does the market for credit-default swaps say about the likelihood of U.S. default?

  63. BLOG

    40% Women on Boards — the New Frontier 

    Mar 1, 2023 Carrie Wang , Tanya Matanda

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    The number of women on boards continues to rise. While a 30% board gender diversity target has long been the magic number, the continued evolution of boards, both by choice and by regulation, means 40% women on boards is becoming the new frontier.

  64. BLOG

    Drawing Insights from Thematic Exposures: The (Natural) Language of Growth Investing 

    Feb 27, 2023 Anil Rao

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    What impact could natural language processing (NLP) have on equity portfolio management? We explore how firms’ thematic exposures, assembled with an assist from NLP, can bring unique insights to portfolios.

  65. BLOG

    Regional Blocs: Emerging to Diverging Markets 

    Feb 22, 2023 Oleg Ruban

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    One of the primary investment implications of deglobalization in 2022 was a greater dispersion of returns among countries. We review the investor challenge of identifying potential pockets of opportunity through targeted EM allocations.

  66. BLOG

    Global Markets One Year After Russia’s Invasion of Ukraine 

    Feb 21, 2023 Ashish Lodh , Andy Sparks , Tom Leahy , Elchin Mammadov

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    Markets have partially recovered since Russia invaded Ukraine, but questions remain about inflation, economic growth and central banks’ actions. Understanding last year’s performance across asset classes, may help with investment decisions in 2023.

  67. BLOG

    What Biodiversity Loss and COP15 Mean for Investors 

    Feb 16, 2023 Sylvain Vanston , Arne Philipp Klug

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    Investors face growing pressure to reverse biodiversity loss. We take a look at the issues shaping nature-related financial risk, key takeaways from the COP15 pact for investors and developments in biodiversity-based disclosure.

  68. BLOG

    Agency MBS in 2023: Uncharted Territory 

    Feb 15, 2023 Yihai Yu

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    Rates spiked in 2022 as the Federal Reserve started quantitative tightening, pushing the prices of most agency mortgage-backed securities into discount territory, while prepayment speeds have slowed to a historical low. The market has entered uncharted territory.

  69. BLOG

    A Day in the Life of Regional Futures 

    Feb 15, 2023 Hitendra D Varsani , Dinank Chitkara

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    Investors benchmarked to global and regional indexes may use index futures for hedging or asset-allocation decisions. We analyzed the intra-day volume patterns of futures linked to the MSCI World, MSCI EM and MSCI EAFE Indexes to illuminate pockets of liquidity.

  70. BLOG

    Is Inflation Here to Stay? 

    Feb 13, 2023 Jim Costello

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    The market has recently signaled optimism about slowing inflation and interest-rate hikes. If correct, such easing could lead to lower mortgage rates. But could real estate costs themselves continue to push up inflation?

  71. BLOG

    Matching Portfolios and Clients’ Expected Returns, with Factors 

    Feb 10, 2023 Milan Horvath , Hamed Faquiryan , Andrew DeMond

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    Wealth managers face the challenge of matching clients’ objectives with an ever-growing set of investment products. Standard practice is to build strategic asset-allocation models based on broad capital-market assumptions. But we present a new approach.

  72. BLOG

    How to Evaluate Climate Metrics and Avoid the Big Confusion 

    Feb 8, 2023 Guido Giese , Manish Shakdwipee

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    Climate metrics can often be a daunting field, with misunderstanding and confusion rife. We present a two-step toolkit that can help investors identify the most suitable metrics as they look to gauge progress toward their climate-investing goals.

  73. BLOG

    Four Scenarios for 2023: Navigating Uncertainty 

    Feb 2, 2023 Thomas Verbraken , Will Baker

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    The macroeconomic landscape for 2023 is shrouded in uncertainty following a tumultuous 2022. We consider four scenarios for growth, rates and inflation and gauge their potential impact on a portfolio of global equities and U.S. bonds.

  74. BLOG

    The Performance of ESG Indexes: Year in Review 

    Jan 31, 2023 Saurabh Katiyar , Yuliya Plyakha Ferenc

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    There were several dynamics that influenced the performance of ESG indexes in 2022. We examine the impact of macroeconomic and financial conditions on returns in the short- and long-term.

  75. BLOG

    What Would the SEC’s Liquidity Proposal Mean for Equity Funds? 

    Jan 27, 2023 Daniel F. Molnar , Laszlo Hollo

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    The SEC recently proposed amendments to the liquidity classification of open-end investment funds, aimed at standardizing reporting practices. But under the proposed approach, many large equity funds could exceed regulatory limits.

  76. BLOG

    Climate Indexes' Year in Review: The Journey Toward a Low-Carbon Transition 

    Jan 26, 2023 Saurabh Katiyar , Manish Shakdwipee

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    There have been several dynamics that influenced climate-index performance in 2022. We examine the impact of macroeconomic and financial conditions on risk, return and sectors, as well as the management of low-carbon transition risks.

  77. BLOG

    Comparing Apples to Apples in Bond-Fund Liquidity 

    Jan 24, 2023 László Arany , Andras Szegleti

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    The SEC has proposed changes to standards for classifying the liquidity of fixed-income instruments held by open-end funds. The new approach may not pick up differences between funds and may not signal worsening liquidity amid market stress, however.

  78. BLOG

    Building the Corporate Boards of the Future 

    Jan 23, 2023 Florian Sommer

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    Corporate boards are key in helping companies navigate economic and social disruption. Introducing more climate-related experience, more women and appointing younger directors are three key factors that could help strengthen boards.

  79. BLOG

    India Equity Futures for the World 

    Jan 17, 2023 Rohit Gupta , Dinank Chitkara

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    India is the world’s fifth largest economy and one of the fastest-growing major markets. We believe that futures linked to the MSCI India Index could help capture a deeper opportunity set and manage Indian equity exposure. 

  80. BLOG

    No Country for Old Firms? Revisiting Growth and Thematic Investing 

    Jan 11, 2023 Anil Rao , Ketaki Garg

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    Investors that were previously enthralled with growth at any price have since retreated. With this in mind, we focus on spotting key differences between growth and thematic investing, and highlight how the two can complement each another.

  81. BLOG

    Parallel Benchmarking for Climate Alignment 

    Jan 5, 2023 Saurabh Katiyar , Guillermo Cano , Román Mendoza

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    Broad market-cap weighted indexes might not fully assess climate-objective alignment. We believe that an appropriate parallel benchmark could help illustrate this alignment, improve transparency and allow investors to make more informed decisions.

  82. BLOG

    Markets in Focus: Investors Look to Capture Big Market Shifts 

    Jan 3, 2023 Waman Virgaonkar , Hitendra D Varsani

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    Global equities and bonds declined in 2022 against a surge in inflation, waning economic growth and monetary tightening. We highlight how factor indexes, country allocation and thematic investing can help investors capture opportunities with greater precision.

  83. BLOG

    Growth Investing in Private Markets: Trends and Transparency 

    Dec 15, 2022 Padmakar Kulkarni , Yaonan Zhang , Stuart Doole

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    Are quoted returns of private-equity investment comparable to those in public equity markets? To analyze this quandary, we use transaction and order-book data for timely insights into venture capital trends and relate them to public markets. 

  84. BLOG

    Challenges for Non-Traded Private REITs Are Not Unique 

    Dec 15, 2022 Jim Costello

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    Increased talk of redemption queues has led to some seeing a dimmer future for groups with net-asset-value REITs — but their challenges are not unique. The impact of credit-market stress has hit all private vehicles for commercial real estate. 

  85. BLOG

    Three Scenarios for Fed Policy, Inflation and Growth 

    Dec 15, 2022 Andy Sparks , Tamas Hanis , Edina Szirmai

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    Despite two months in a row of unexpectedly low inflation, the Fed once again raised rates this week. Amid considerable uncertainty over inflation and rate policy, we analyze three scenarios for the U.S. economy and their impact on diversified portfolios.

  86. BLOG

    Deforestation Risks on the Rise 

    Dec 14, 2022 Arne Philipp Klug

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    Continued forest loss poses risks to companies and investors. We use MSCI’s Biodiversity Screening Metrics to help identify industries exposed to deforestation risks and flag companies for a review of risk-management practices and active engagement.

  87. BLOG

    Six ESG and Climate Trends to Watch for 2023 

    Dec 13, 2022 Meggin Thwing Eastman

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    Amid a seismic shift in the ESG and climate landscape, we identify key trends companies and investors need to be cognizant of. Beyond the road to net-zero, issues such as supply chains, labor management and biodiversity could impact portfolios. 

  88. BLOG

    From Paris to the Pandemic: Investigating Trends in Industry Emissions 

    Dec 12, 2022 Mathew Lee

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    Emissions-intensity metrics can help compare the relative contributions of different holdings to a portfolio’s carbon footprint. However, understanding the reasons behind a firm’s changing emissions is key to identifying sustained reduction trends.

  89. BLOG

    Lost and (Not) Found: Carbon Migration Out of US Public Markets 

    Dec 8, 2022 Abdulla Zaid , Nell Ng

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    While public markets are witnessing growing climate-related regulatory proposals and voluntary commitments, climate disclosures in private markets remain limited. We examine whether carbon emissions are migrating out of U.S. public markets.While public markets are witnessing growing climate-related regulatory proposals and voluntary commitments, climate disclosures in private markets remain limited. We examine whether carbon emissions are migrating out of U.S. public markets.

  90. BLOG

    Has Liquidity Dried Up in Private Equity? 

    Dec 7, 2022 Yang Liu , Andrew DeMond

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    Investors who commit capital to private-asset funds must provide money when the fund managers buy portfolio companies, but receive it back only when the managers sell. The uncertain timing and size of these cash flows demand careful liquidity management.

  91. BLOG

    Three Scenarios for Investors in European Credit 

    Nov 25, 2022 Monika Szikszai , Thomas Verbraken

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    We explore three scenarios of varying severity for European credit, with outcomes for a multi-asset European portfolio ranging from a 2% return in a “mild recession” scenario to an almost 11% drop in a “sharp global recession,” according to our model. 

  92. BLOG

    Total Portfolio Footprinting to Transform Green-Bond Emission Accounting 

    Nov 23, 2022 Michael Ridley

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    We take a look at how MSCI’s Total Portfolio Footprinting could provide an innovative way for investors to compare the financed-emissions of green and non-green bonds, helping them make better informed investment decisions.

  93. BLOG

    The Rise and Fall of Big Tech 

    Nov 22, 2022 Abhishek Gupta , Raina Oberoi

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    U.S. tech giants had a spectacular run over the past decade, but the tide has turned for many of these companies in 2022. We evaluate Big Tech’s descent and discuss the efficacy of building resilient portfolios.

  94. BLOG

    What COP27 Means for Companies and Investors 

    Nov 21, 2022 Sylvain Vanston , Oliver Marchand , Chris Cote , Simone Ruiz-Vergote , Meggin Thwing Eastman

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    COP27 underscored the need for action on corporate climate pledges, the importance of data and a series of initiatives to spur public and private investment for developing countries. We review some of the key developments for companies and investors.

  95. BLOG

    Can Style Momentum Be Optimized? 

    Nov 15, 2022 Simon Minovitsky , George Bonne

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    Momentum is a well-documented investment strategy used across assets, industries and asset classes, as well as style factors. We present an optimized style-timing strategy that accounts for both past performance and the variance-covariance of styles.

  96. BLOG

    Footprinting the World’s Largest Asset Managers 

    Nov 14, 2022 Rumi Mahmood

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    We assessed the carbon footprint of the world’s largest asset managers and found that while there was little difference between equity and fixed income assets, geography and size mattered when it came to carbon intensity.

  97. BLOG

    Leveraging Governance to Improve Net-Zero Engagement 

    Nov 11, 2022 Harlan Tufford

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    Reducing emissions of greenhouse gas may mean that investors engage with companies lacking adequate net-zero targets. This post explores different engagement tools that investors can use to help net-zero laggards catch up to net-zero leaders. 

  98. BLOG

    What Drove Private-Credit Funds’ Outperformance? 

    Nov 9, 2022 Lue Xiong , Andrew DeMond , Hamed Faquiryan

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    When selecting private-credit funds, investors can often only consider broad strategies, due to the general opacity of the asset class. We draw on loan-level data and proprietary analytics to produce a more detailed picture of the direct-lending market. 

  99. BLOG

    Diversification for Home-Biased China Investors 

    Nov 7, 2022 Wei Xu , Shuo Xu

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    The U.S. and China represent two of the largest and complementary global-equity markets. We detail whether home-biased investors in China may be neglecting long-term growth and diversification opportunities.

  100. BLOG

    US Midterm Elections from an Equities Perspective 

    Nov 3, 2022 Abhishek Gupta , Román Mendoza

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    Leading up to and including Nov. 8, Americans will vote for 35 Senate and all 435 of the voting House seats.

  101. BLOG

    A Correction in US Commercial Real Estate 

    Nov 2, 2022 Jim Costello

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    Potential buyers and current owners of U.S. office assets have moved apart on price expectations, causing deal activity to drop. We discuss two approaches to gauging the outlook for pricing.

  102. BLOG

    Supporting the Low-Carbon Transition: An Indexed Approach 

    Nov 2, 2022 Kumar Neeraj , Stuart Doole

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    Investors globally are committing to reduce the carbon footprint of their portfolios. We illustrate how indexes can be an option for investors who wish to finance the transition as well as encourage companies to set and meet net-zero targets. 

  103. BLOG

    Climate Action Could Lessen Physical Climate Risks 

    Nov 1, 2022 Jascha Lehmann , Gillian Mollod

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    A future that relies on fossil fuels could expose almost a quarter of the market value of companies in the MSCI ACWI IMI to the risks of severe physical climate impacts. Which were the most vulnerable sectors and what can be done to limit the risks? 

  104. BLOG


    Oct 31, 2022 Saurabh Katiyar , Yuliya Plyakha Ferenc

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    While much of the market volatility endured, the MSCI ESG Indexes’ performance drivers varied from the first half to the third quarter of 2022. We examine the impact of macroeconomic and financial conditions on returns in the short- and long-term.

  105. BLOG

    ESG Indexes Lifted by Carbon-Efficient Firms but Underperformed 

    Oct 31, 2022 Saurabh Katiyar , Yuliya Plyakha Ferenc

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    While much of the market volatility endured, the MSCI ESG Indexes’ performance drivers varied from the first half to the third quarter of 2022. We examine the impact of macroeconomic and financial conditions on returns in the short- and long-term.

  106. BLOG

    Keeping Energy Exposure While Lowering Emissions 

    Oct 25, 2022 Xinxin Wang

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    Could equity managers have maintained their energy exposure during the sector’s recent outperformance while also reducing carbon emissions? We find that they could have lowered emissions but with some trade-offs during our study period. 

  107. BLOG

    Decarbonizing Bond Portfolios: Risk Trade-Offs 

    Oct 21, 2022 Juan Sampieri , Monika Szikszai

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    Bond investors looking to reduce their portfolios’ carbon footprint may decide to shift capital from high to low emitters. Did a decarbonizing approach that preserves sector exposures significantly change the main portfolio risk characteristics? 

  108. BLOG


    Oct 6, 2022 Saurabh Katiyar , Manish Shakdwipee , Xinxin Wang

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    There have been several dynamics that have influenced climate-index performance in the third quarter and first nine months of 2022. We examine the impact of macroeconomic and financial conditions on risk, return and sectors. 

  109. BLOG

    Despite Energy Outperformance, Climate Indexes Were Resilient 

    Oct 6, 2022 Saurabh Katiyar , Manish Shakdwipee , Xinxin Wang

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    There have been several dynamics that have influenced climate-index performance in the third quarter and first nine months of 2022. We examine the impact of macroeconomic and financial conditions on risk, return and sectors. 

  110. BLOG

    Getting the Full Picture on Tenant-Default Risk in Real Estate 

    Oct 6, 2022 Fritz Louw

    Learn More

    With economic pressures mounting, we examine the importance of analyzing rental income across all tenants in real estate funds, and not just the biggest tenants. 

  111. BLOG

    Markets in Focus: Is the Beta Pendulum an Edge or Hedge? 

    Sep 30, 2022 Waman Virgaonkar , Hitendra D Varsani

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    Investors remained fearful of inflation and recession worries in the third quarter of 2022. We take a closer look at beta in a period where factors were sensitive to changing market conditions.

  112. BLOG

    Rent-Growth Expectations Shaped Returns for US Industrial Real Estate 

    Sep 27, 2022 Bryan Reid

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    Investment in industrial real estate has benefited in recent years from the growth of online shopping, a trend that was turbocharged during the pandemic. But are expectations for the sector still grounded in reality?   

  113. BLOG

    Net-Zero Alignment for Multi-Asset-Class Portfolios 

    Sep 19, 2022 Ashish Lodh , Guido Giese , Afsaneh Mastouri

    Learn More

    Asset owners who want to keep global warming below 1.5 degrees Celsius (1.5°C) have a tough row to hoe.

  114. BLOG

    Climate Stress Tests: Upping the Ante for Banks and Insurers 

    Sep 16, 2022 Sita Subramanian

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    When institutional investors and financial supervisors seek to understand climate risk exposures of banks and insurers, they look to climate scenario analysis. 

  115. BLOG

    Looking Beyond Japan to Understand Risks to the Yen 

    Sep 15, 2022 Michael Hayes , Tamas Hanis

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    By remaining steadfast in its commitment to zero yields, the Bank of Japan may have sacrificed the ability to control its own destiny. 

  116. BLOG


    Sep 15, 2022 Michael Hayes , Tamas Hanis

    Learn More

  117. BLOG

    Crowd Control for Fund Managers 

    Sep 1, 2022 Anil Rao , George Bonne , Daisy Hu

    Learn More

    Stock markets around the world have heated up this summer. The MSCI ACWI Investable Market Index (IMI) has gained 5% in the third quarter, a partial thaw from its chill when it fell 20% through the first half of the year. 

  118. BLOG

    Portfolio Intelligence Through a Carbon-Efficiency Factor 

    Sep 1, 2022 Peter Zangari , Donald Sze , Guillermo Cano

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    The transition to a low-carbon economy may trigger a major transformation of the global economy, generating significant risks and opportunities for companies and investors.

  119. BLOG

    Inflation Reduction Act May Energize Utilities’ Energy Transition 

    Aug 31, 2022 Elchin Mammadov , Mathew Lee

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    The Inflation Reduction Act may help utilities and energy firms reduce direct and indirect emissions through tax-credit incentives designed to scale up the deployment of renewables and accelerate development of frontier decarbonization technologies.  

  120. BLOG

    How Did Climate Corporate-Bond Indexes Weather Market Volatility? 

    Aug 31, 2022 Afsaneh Mastouri

    Learn More

    Climate indexes tend to have a lower weighting (relative to parent indexes) allocated to companies in the emission-intensive energy, utilities and materials sectors. Did these indexes underperform in the year to date, given high recent energy prices?

  121. BLOG

    Navigating Inflation in Equity Portfolios 

    Aug 25, 2022 Mehdi Alighanbari , Anshul Kamra

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    Stock-level inflation sensitivity can help investors assess a portfolio’s exposure to inflation. We use this metric to construct hypothetical portfolios aligned with investors’ range of views on inflation.  

  122. BLOG


    Aug 24, 2022 Yuliya Plyakha Ferenc , Saurabh Katiyar

    Learn More

    There have been specific dynamics that have influenced ESG-index performance in the first half of 2022. We examine the impact of macroeconomic and financial conditions on return in the short- and long-term. 

  123. BLOG

    MSCI ESG Indexes Underperformed but Met ESG Objectives 

    Aug 24, 2022 Yuliya Plyakha Ferenc , Saurabh Katiyar

    Learn More

    There have been specific dynamics that have influenced ESG-index performance in the first half of 2022. We examine the impact of macroeconomic and financial conditions on return in the short- and long-term. 

  124. BLOG

    Inflation Sensitivity and Equity Returns 

    Aug 17, 2022 Mehdi Alighanbari , Anshul Kamra

    Learn More

    Inflation and the chatter around inflation have been rising since last year (as shown in the exhibit below) following years of relatively tame inflation. This macroeconomic shift is likely to have both a short- and long-term impact on asset prices and has raised many important questions for investors.

  125. BLOG

    Private Assets Can’t Hide from SEC’s Proposed Climate Rule 

    Aug 8, 2022 Abdulla Zaid , Rumi Mahmood , Umar Ashfaq

    Learn More

    The SEC’s climate-disclosure proposal also may affect U.S.-listed GPs’ portfolios. In reality, the rule may represent the camel’s nose under the tent as the SEC indirectly brings climate transparency to some private companies.

  126. BLOG

    Did Closed-End Real Estate Funds Add Value? 

    Aug 3, 2022 Will Robson , Niel Harmse

    Learn More

    Global real estate markets enjoyed their strongest returns since the 2008 global financial crisis (GFC) as they bounced back from COVID-19-induced weakness last year.

  127. BLOG

    Value and Growth Investing as ESG and Climate Friendly 

    Jul 28, 2022 Guillermo Cano , Padmakar Kulkarni

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    Many investors may be seeking to align their value- or growth-oriented portfolios with the consideration of ESG as well as the transition to a low-carbon economy. We detail several approaches for working toward these investment objectives.

  128. BLOG


    Jul 19, 2022 Saurabh Katiyar

    Learn More

    There have been several dynamics that have influenced climate-index performance in the first half of 2022. We examine the impact of macroeconomic and financial conditions on risk, return, sectors and factors.

  129. BLOG

    Climate Indexes Brought Short-Term Gloom with Blooming Offshoots 

    Jul 19, 2022 Saurabh Katiyar

    Learn More

    There have been several dynamics that have influenced climate-index performance in the first half of 2022. We examine the impact of macroeconomic and financial conditions on risk, return, sectors and factors.

  130. BLOG

    Measuring Climate Impact with Total-Portfolio Carbon Footprinting 

    Jul 18, 2022 Thomas Verbraken , Monika Szikszai

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    Carbon footprinting across multi-asset-class portfolios allows investors to measure financed emissions and inform decarbonization decisions. We examine this important step toward managing the net-zero journey.

  131. BLOG

    Abenomics’ Impact on Japanese Firms and Global Investors 

    Jul 13, 2022 Naoya Nishimura , Anil Rao , Moeko Porter

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    As the world mourns former Japanese Prime Minister Shinzo Abe, we ask: What was his impact on Japanese firms and global investors? To help answer, we look at two key initiatives: competitiveness and profitability, and corporate governance.

  132. BLOG

    Equities Ownership: Concentration on the Rise? 

    Jul 11, 2022 Ric Marshall , Jonathan Ponder

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    Controlled companies accounted for nearly 46% of all constituents of the MSCI ACWI Index, as of Feb. 1, 2022, a 44% increase from 2015 levels. What does growing concentration mean for minority shareholders?

  133. BLOG

    Index Replication with Futures in a Deglobalized World 

    Jul 6, 2022 Hitendra D Varsani , Dinank Chitkara

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    While investors may aim to synthetically replicate equity indexes using a basket of local-index futures and currency forwards, our research focuses on potential country and currency risk as well as tracking error of these efforts. 

  134. BLOG

    Markets in Focus: Half-Time – Keeping it Real and Defensive 

    Jun 30, 2022 Waman Virgaonkar , Hitendra D Varsani

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    It was a challenging market environment in the second quarter. We take a closer look at real assets, defensive sectors and factor indexes as investors navigate what might be a prolonged period of volatility and uncertainty.

  135. BLOG

    Chinese High-Yield Corporate Bonds Under Pressure 

    Jun 30, 2022 Daniel F. Molnar

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    Bonds from Chinese property developers have come under severe distress, and the latest wave of COVID-19 lockdowns have had a heavy impact on China’s economy. How has the country’s corporate-bond market responded?

  136. BLOG

    Carbon Markets: An Emerging Derivatives Class 

    Jun 28, 2022 Hitendra D Varsani , Rohit Gupta

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    Carbon markets can play a significant role in managing carbon risk within equity portfolios to hedge against price risks. Our research focuses on applications, carbon-risk management and correlations to other assets classes.

  137. BLOG

    The Impact of ESG and Climate on Equity Yield 

    Jun 28, 2022 Ashish Lodh

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    Investors are increasingly incorporating ESG and climate considerations in asset selection. With that in mind, our research focuses on ESG and climate profiles in relation to equity yield and tracking error.

  138. BLOG

    How Eurozone Inflation and ECB Policy Could Impact Markets 

    Jun 27, 2022 Thomas Verbraken , Daniel Szabo

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    In a portfolio stress test, we consider the uncertainty around eurozone inflation and the European Central Bank’s policymaking. We outline four scenarios and their potential impact on the bloc’s economy and a hypothetical multi-asset-class portfolio.

  139. BLOG

    Are Emissions Rising or Falling in Equity Indexes? 

    Jun 22, 2022 Monika Szikszai , Zoltán Nagy

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    Investors can use different metrics to track their portfolios’ carbon footprint. Regardless, they will increasingly need tools to better identify the sources of changes in whichever climate metrics they use. We present an attribution methodology.

  140. BLOG

    Introducing the Carbon Market Age 

    Jun 8, 2022 Hitendra D Varsani , Rohit Gupta

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    The carbon market can play a significant role in the decarbonization of the global economy by putting a price on carbon and giving polluters an incentive to reduce their emissions.

  141. BLOG

    Plastic Packaging: The Unmasking of Regulations 

    Jun 7, 2022 Samuel Block , Shitiz Chaudhary

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    A rapid increase in plastic-waste regulations may increase costs and liabilities, or limit market access for companies that are slow to align with them.  

  142. BLOG

    The Signal for Industrial Property Amid E-Commerce Noise 

    Jun 7, 2022 Jim Costello

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    Demand and pricing for industrial commercial property got a boost from spiking e-commerce demand during the early part of the pandemic. We look at the longer-term trends in e-commerce sales for guidance.

  143. BLOG

    Real Estate Has Bucked the Deglobalization Trend 

    May 27, 2022 Bryan Reid , Oleg Ruban

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    Real estate investors have historically exhibited a strong home bias. But there is evidence that real estate may have become more global based on return and transaction behavior — bucking the trend, evident in listed markets, toward deglobalization.

  144. BLOG

    Are Russian Stocks Worthless? 

    May 26, 2022 Michael Hayes , Tamas Hanis , Zoltan Sass

    Fixed Income

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    Investors in Russian securities have faced sizable hurdles trying to manage and value their positions. Our research of the CDS market suggests that Russian stocks are essentially worthless, in contrast to the prices listed on the Moscow Exchange.

  145. BLOG

    SEC Climate Disclosure: Targeting Standardization 

    May 17, 2022 Antonios Panagiotopoulos , Kenji Watanabe

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    The SEC has proposed new requirements for U.S.-listed companies to disclose information on climate-related risks. We believe the framework may represent an opportunity to facilitate the transparency and standardization of climate-related goals.

  146. BLOG

    A Factor-Based Approach to Munis in Turbulent Times 

    May 11, 2022 Hamed Faquiryan , Lue Xiong

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    Tracking municipal-bond benchmarks can mean evaluating hundreds of thousands of securities along many dimensions, such as credit ratings. We evaluate an alternative, factor-model-based approach. 

  147. BLOG

    Location Matters: Using Geospatial Analysis to Assess Biodiversity Risks 

    May 10, 2022 Gillian Mollod , Arne Philipp Klug

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    A quarter of animal and plant species could face extinction heightening economic risks from biodiversity loss. Investors and issuers focusing on asset location and dedicated risk management practices could mitigate some of these challenges.

  148. BLOG

    China at a Crossroads: Three Scenarios for Investors 

    May 9, 2022 Daniel Szabo , Thomas Verbraken

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    The recent COVID-19 lockdowns in China and their impact on global supply chains add another concern for investors, on top of the Russia-Ukraine war. We model three scenarios for China and their potential spillover effects on global portfolios.

  149. BLOG

    Wildfire Risks and Costs for Companies 

    May 5, 2022 Vera Heck , Simon Albrecht

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    Wildfires can potentially increase costs from physical risks for companies, making it an important consideration for investors as they manage risk in their portfolios. Our analysis revealed four future hotspots with elevated annual fire probabilitie

  150. BLOG

    Russian Bonds: Rolling Back the Default Clock 

    May 4, 2022 Andy Sparks , Gabor Almasi

    Fixed Income

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    The Russian government’s decision on April 29 to pay holders of two dollar-denominated Russian sovereign bonds led to a major rally, encouraging some investors that Russia may avoid default. There are, however, more challenges ahead. 

  151. BLOG

    Low Carbon and High Liquidity for Bond Investors? 

    May 4, 2022 Afsaneh Mastouri

    ESG Research , Fixed Income

    Learn More

    As corporate-bond investors embrace decarbonization as a goal in portfolio construction and management and benchmark selection, the question arises whether decarbonization targets are at odds with other desirable index attributes, such as liquidity.

  152. BLOG

    Russian Bonds: Sifting Through Sectors 

    Apr 29, 2022 Andy Sparks , Andras Szegleti , Andras Rokob

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    Russian bond market losses have cut deep. Still, certain sectors fared better than others. The question now is how trade policy and sanctions may be shifting, and whether there may be greater impact on sectors that have shown relative strength.

  153. BLOG

    Which Scope 3 Emissions Will the SEC Deem ‘Material’? 

    Apr 28, 2022 Kenji Watanabe , Umar Ashfaq

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    The SEC’s climate-disclosure proposals did not set a “materiality threshold” for Scope 3 emissions, and the commission is considering either quantitative analysis for a uniform approach or letting companies determine materiality. How might each affect transparency?

  154. BLOG

    Real Estate's Income Risk in an Inflationary World 

    Apr 27, 2022 Fritz Louw

    Learn More

    Although real estate income returns have tended to be stable in aggregate, the right-hand chart below illustrates the extent to which they have varied across individual properties in the MSCI Pan-European Quarterly Property Fund Index (PEPFI).

  155. BLOG

    Sanctions Bring a New Form of Russian-Bond CDS Risk 

    Apr 26, 2022 Gabor Almasi , László Arany

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    Sanctions on Russia have not affected credit-default swaps directly, but the settlement process following a default would rely on delivering and auctioning the sanctioned bonds. We examine this new form of recovery risk.

  156. BLOG

    As TCFD Comes of Age, Regulators Take a Varied Approach 

    Apr 21, 2022 Emma Wu , Zohir Uddin

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    The recommendations of the Task Force on Climate-related Financial Disclosures have become a landmark reference for investors, who now face the challenge of making sense of how various jurisdictions will implement their versions of the TCFD’s standards.

  157. BLOG

    Drivers of China Equities’ Sell-Off 

    Apr 20, 2022 Wei Xu , Shuo Xu

    Emerging Markets , Global Investing , Equity Themes , Equity indexes

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    Following the recent sell-off in Chinese equities, global investors may have some concerns and questions about their China exposure. Have fundamentals changed? What role did the Russia-Ukraine war play? Which factors are important to keep an eye on?

  158. BLOG

    Understanding Private Capital’s Exposure to Carbon-Intensive Sectors 

    Apr 7, 2022 Rumi Mahmood , Abdulla Zaid

    Real Estate Investing

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    Understanding private capital’s exposure to the energy, materials and utilities sectors, and their related industries, across asset classes, may be critical in supporting more-informed risk management and engagement decisions.

  159. BLOG

    Fed Policy and the Threat of Stagflation 

    Apr 4, 2022 Daniel Szabo , Will Baker , Thomas Verbraken

    Integrated Risk Management

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    Investors are increasingly focused on inflation and the Fed’s tightening of monetary policy. With the Russia-Ukraine war and resulting sanctions, they may also worry about slowing economic growth. We model three economic scenarios’ potential impact on markets.

  160. BLOG

    Factors in Focus: Disentangling Market Gyrations Through the War 

    Apr 1, 2022 Waman Virgaonkar , Hitendra D Varsani

    Factor Investing

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    It was a tale of two quarters in many ways. We analyze the effects of past and present military conflicts on factor investing to provide insights to investors seeking to build resilient portfolios.

  161. BLOG

    Could Europe’s Shift from Russian Gas Accelerate Climate-Transition Risk? 

    Mar 30, 2022 Chris Cote , Zoltán Nagy , Guido Giese

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    Europe’s search for energy sources outside of Russia may slow the low-carbon transition in the short term. Staying within a net-zero cumulative emissions budget would mean fewer emissions later. What might this path mean for investors’ portfolios?

  162. BLOG

    Companies May Not Be Ready for SEC Climate-Disclosure Rules 

    Mar 29, 2022 Chris Cote , Kenji Watanabe

    Learn More

    The SEC proposed requirements for U.S. companies to disclose certain climate-related risks, beginning in 2024. To assess whether companies are prepared to meet these requirements, we looked at the emission-disclosure rates of a large sample of U.S. equities.

  163. BLOG

    What Drove 2021 Real Estate Returns? 

    Mar 25, 2022 Niel Harmse , Will Robson

    Real Estate Investing

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    As 2021 real estate index returns roll in, we’ve seen a broad-based acceleration of returns across nearly all countries and property types. But what can looking beyond the aggregate index returns tell us about the difference between the winners and losers?

  164. BLOG

    Bond-Index Replication While Navigating Volatility 

    Mar 23, 2022 Andy Sparks , Juan Sampieri , Chris Fenske

    Learn More

    Market volatility poses major challenges to investors trying to track bond indexes while also keeping transaction costs low. Can managers of funds tracking bond indexes balance transaction costs and tracking error?

  165. BLOG

    Evaluating Options in Different Macro and Volatility Regimes 

    Mar 22, 2022 Dinank Chitkara , Hitendra D Varsani

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    Faced with volatile markets, some have looked to options strategies to manage volatility or target alternative risk/return profiles. We evaluate historical performance of options-overlay strategies across various macro and volatilty regimes.

  166. BLOG

    Quality in Times of Crisis 

    Mar 17, 2022 Anil Rao

    Learn More

    Two years into the “pandemic rally,” global equities finally cooled as rising inflation, looming interest-rate hikes and the war in Ukraine spooked equity investors. High-quality firms, however, have been relatively resilient. We examine why.

  167. BLOG

    Reported Emission Footprints: The Challenge is Real 

    Mar 9, 2022 David Bokern

    ESG Research

    Learn More

    Investors’ ability to make comprehensive assessments of companies’ climate profiles relies on being able to analyze trustworthy corporate disclosures of greenhouse-gas emissions. Yet the current state of disclosures remains challenging.

  168. BLOG

    Which Factors Rose with the Price of Oil? 

    Mar 8, 2022 Jean-Maurice Ladure , Ashish Lodh

    Factor Investing

    Learn More

  169. BLOG

    Riding Rising Interest Rates with the Agency-MBS Model 

    Mar 1, 2022 Yihai Yu

    Fixed Income

    Learn More

    Expectations of higher inflation dominated the market for U.S. agency mortgage-backed securities in 2021. We reviewed the performance of our agency-MBS model in 2021, to assess its accuracy and help investors manage MBS risk through what may be a volatile 2022.

  170. BLOG

    Markets May Be Vulnerable to Stagflation from Russian Invasion 

    Feb 28, 2022 Daniel Szabo , Thomas Verbraken

    Learn More

    In addition to the growing human toll, Russia’s invasion of Ukraine could significantly impact economies and financial markets worldwide. We employ stress testing to explore two scenarios and their consequences for multi-asset-class portfolios.

  171. BLOG

    Has DEI Worked for Women? 

    Feb 28, 2022 Christina Milhomem

    ESG Research

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    Have Diversity, Equity and Inclusion programs worked for women? While these can help establish frameworks and goals, it’s less clear whether they actually have improved diversity.

  172. BLOG

    Five Misconceptions About Climate-Change Risk in Real Estate 

    Feb 25, 2022 Bryan Reid , Jascha Lehmann

    Real Estate Investing

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    Real estate portfolios may be particularly vulnerable to the threat of climate-change risks. While investors are increasing their focus on the topic and considerable progress has been made in recent years, some misconceptions remain.

  173. BLOG

    中国绿色债券市场:发行量不断增长, 历史表现优异 

    Feb 24, 2022 Jian Chen , Joy Zhang

    ESG Research , Fixed Income

    Learn More


  174. BLOG

    China’s Green-Bond Market: Growing Issuance and Historical Outperformance 

    Feb 24, 2022 Jian Chen , Joy Zhang

    ESG Research , Fixed Income

    Learn More

    China’s green-bond market has grown rapidly in recent years and is now second in size only to the U.S. Understanding the reasons behind this market’s growth and performance may help investors as they consider incorporating Chinese green bonds in portfolios.

  175. BLOG

    Paris-Aligned Indexes to Manage the Future 

    Feb 17, 2022 Dinank Chitkara , Hitendra D Varsani , Rohit Mendiratta

    ESG Research

    Learn More

    As commitments to reach net-zero by 2050 surge, institutional investors are looking for tools to implement net-zero strategies in portfolios. Futures linked to the MSCI Climate Paris Aligned Indexes are one option for asset managers and asset owners.

  176. BLOG

    Latin American Equity Markets: The Lay of the Land 

    Feb 16, 2022 Raina Oberoi , Román Mendoza

    Equity indexes

    Learn More

    How is Latin America different from other emerging markets? We analyze the influence of foreign direct investment; market performance; exposure to sectors and thematic investments; ESG and climate risks and opportunities and corporate-ownership structures. 

  177. BLOG

    Say on Climate: Investor Distraction or Climate Action? 

    Feb 15, 2022 Florian Sommer , Harlan Tufford

    ESG Research

    Learn More

    Say-on-climate shareholder votes are on the rise globally. Are they a distraction to real climate efforts or an effective way for shareholders to engage management?

  178. BLOG

    US ABS: Strong Bounce Back, Uneven Performance 

    Feb 10, 2022 Yini Yang , Joy Zhang

    Fixed Income

    Learn More

    As the U.S. job market has begun to recover, so have consumer credit levels. The issuance of U.S. consumer asset-backed securities (ABS) had a strong bounce back in 2021. What drove this surge across ABS markets?

  179. BLOG

    Nasdaq’s New Board Diversity Rules: What’s the Impact? 

    Feb 1, 2022 Christina Milhomem , Harlan Tufford

    ESG Research

    Learn More

    The Nasdaq stock exchange’s new diversity rules will impose board-diversity disclosure requirements on Nasdaq-listed companies. These new rules may nudge companies to improve the diversity of the boards or risk facing investor pressure.

  180. BLOG

    Managing Climate-Transition Risk in Credit Portfolios 

    Jan 31, 2022 Afsaneh Mastouri

    ESG Research , Fixed Income

    Learn More

    Can managers take an active approach to systematically managing exposure of a corporate-bond portfolio to climate-transition risk? We investigate two different approaches to decarbonizing credit portfolios.

  181. BLOG


    Jan 28, 2022 Yuliya Plyakha Ferenc

    ESG Research

    Learn More

    In 2021, oil and gas stocks bounced back after five years of weak performance. However, leading MSCI ESG Indexes, which often have lower weights to high-carbon emission industries such as oil and gas, were resilient last year. What drove performance?

  182. BLOG

    Despite Oil & Gas’s Rebound, ESG Indexes Outperformed 

    Jan 28, 2022 Yuliya Plyakha Ferenc

    ESG Research

    Learn More

    In 2021, oil and gas stocks bounced back after five years of weak performance. However, leading MSCI ESG Indexes, which often have lower weights to high-carbon emission industries such as oil and gas, were resilient last year. What drove performance?

  183. BLOG

    Personalizing Climate-Focused Wealth Management Portfolios 

    Jan 24, 2022 Jean-Maurice Ladure

    ESG Research

    Learn More

    A climate-first approach can help wealth managers tailor portfolios to the unique preferences of clients who want their investments to slow climate change or create positive impact while furthering their financial objectives and appetite for risk.

  184. BLOG

    Why Your Portfolio May Be Hot, Cold or Just Right 

    Jan 19, 2022 Zoltán Nagy , Helen Droz

    ESG Research

    Learn More

    Investors may want to understand not only if their portfolios are aligned with global climate goals but why they may (or may not) fall short of the mark. A performance-attribution analysis can help them understand how “hot” or “cold” their portfolios are.

  185. BLOG

    Climate Change and the Cow in the Room 

    Jan 18, 2022 Paribesh Pradhan

    ESG Research

    Learn More

    The global food system is one of the major drivers of climate change, biodiversity loss and depletion of freshwater resources. We looked at traditional plant-based and alternative proteins trends and potential transition risks to food companies’ valuations.

  186. BLOG

    How ‘Greenflation’ Could Impact Bond Returns 

    Jan 14, 2022 Daniel Szabo , Thomas Verbraken

    Fixed Income

    Learn More

    Investors and policymakers are increasingly focused on the fact that a transition to a low-carbon economy could result in “greenflation,” which could put upward pressure on long-term interest rates and in turn lead to downward repricing of bond portfolios.

  187. BLOG

    2022 Private-Asset Trends to Watch 

    Jan 13, 2022 Will Robson

    Real Estate Investing

    Learn More

    Private-asset investors are waking up to the urgency of the climate crisis, while dealing with other long-term disruptive trends that accelerated during the pandemic. We may see a substantial reallocation of capital as investors respond to these challenges.

  188. BLOG

    Hotter Inflation Set Some Styles and Sectors on Fire 

    Jan 11, 2022 Ashish Lodh , Hitendra D Varsani

    Factor Investing

    Learn More

    Whether due to stimulus, deglobalization, decarbonization or an overheating economy, higher inflation could have an impact on style-factor and sector performance. We investigate this impact in the context of two potential economic-growth regimes.

  189. BLOG

    Higher Agency Loan-Size Limit: A Booster Shot in ARMs? 

    Jan 10, 2022 László Ábel Somlai , Miklós Vörös , Yihai Yu

    Fixed Income

    Learn More

    Securitizations for U.S. agency adjustable-rate mortgages have declined since the 2008 global financial crisis. But could a loan-limit increase by the government-sponsored enterprises, boost issuance of agency-ARM mortgage-backed securities?

  190. BLOG

    ESG Trends to Watch for 2022 

    Jan 7, 2022 Linda-Eling Lee , Meggin Thwing Eastman

    ESG Research

    Learn More

    As the world’s biggest companies work toward net-zero, corporations ask: What do we do about our suppliers? Meanwhile, ESG investing truly has gone mainstream (with the regulatory attention to prove it). We review these trends and emerging risks.

  191. BLOG

    Factors in Focus: Are Your Equity Styles Ahead of the Curve? 

    Jan 5, 2022 Waman Virgaonkar , Hitendra D Varsani

    Factor Investing

    Learn More

    If economic expansion and higher inflation continue in 2022, interest rates could rise around the world. As investors re-evaluate equity portfolios, we look at factor-index performance in different U.S. interest-rate and yield-curve regimes.

  192. BLOG

    Did Market Liquidity Impact Real Estate Returns? 

    Dec 16, 2021 Bryan Reid

    Real Estate Investing

    Learn More

    Real estate is an illiquid asset class. But liquidity can also vary considerably between different assets, markets and time periods. Have differences in liquidity within real estate had an impact on investment returns?

  193. BLOG

    Will Rising Sea Levels Eventually Sink Christmas? 

    Dec 15, 2021 Patric Kellermann , Miranda Carr

    ESG Research

    Learn More

    It’s not just Santa’s North Pole headquarters that are at risk from global warming. Around 75% of the world’s toys are made in China — most coming from the country’s coastal provinces which face an increasing threat of flooding as global temperatures rise.

  194. BLOG

    Which Companies Lost Most in Europe’s Lost Decade? 

    Dec 14, 2021 Anil Rao , Jean-Maurice Ladure

    Global Investing

    Learn More

    If uncertainties over deglobalization persists, the performance divide between Europe and the U.S. could widen further. Have European firms been more at risk, given they have had more international revenue than U.S. companies?

  195. BLOG

    Did Deglobalization Add to Inflation Woes? 

    Dec 13, 2021 Román Mendoza , Oleg Ruban

    Global Investing

    Learn More

    Inflation watchers, aware of how COVID-19 led to trillions of dollars of stimulus, may want to note the longer-term shift toward deglobalization. As these forces collide, they may lead to rising global inflation and affect asset-allocation strategies.

  196. BLOG

    The Implied Temperature Rise of 'Paris-Aligned' Indexes 

    Dec 6, 2021 Rumi Mahmood , Helen Droz

    ESG Research

    Learn More

    Using Implied Temperature Rise — an intuitive metric that can be used to assess net-zero alignment — we analyze temperatures for climate-focused indexes designed to meet or exceed the requirements of the EU Paris-Aligned Benchmarks standard.

  197. BLOG

    What Implied Temperature Rise Means for Funds 

    Dec 6, 2021 Rumi Mahmood , Helen Droz

    ESG Research

    Learn More

    With COP26 over, the hard work begins as investors seek to limit temperature rise to less than 2°C above preindustrial levels in their portfolios. We investigate how they can understand whether a portfolio or fund is aligned with temperature targets.

  198. BLOG

    Spotlight on the Markets: Are Supply Chains the New Grinch 

    Dec 3, 2021 Ana Harris , Mehdi Alighanbari

    Global Investing

    Learn More

    The holiday season may only exacerbate supply-chain challenges affecting the availability and prices of goods. In this inaugural edition of Spotlight on the Markets, we analyze performance and how investors are working to rise to the occasion.

  199. BLOG

    Is the Food Industry Ready for Kunming? The Short Answer Is No. 

    Dec 2, 2021 Leslie Swynghedauw

    ESG Research

    Learn More

    Over the past two years, a growing number of governments have stepped up their plans to protect biodiversity. The most affected industry: Food products, which may face rising regulatory costs and reduced fiscal subsidies. What are the risks to investors?

  200. BLOG

    New Frontiers in Carbon Footprinting: Private-Equity and -Debt Funds 

    Nov 29, 2021 Rumi Mahmood , Abdulla Zaid

    ESG Research

    Learn More

    Private-capital funds, which can quickly make large investments in specific targets, are potentially powerful agents in the fight against climate change. But where do private-equity and -debt funds stand in terms of their estimated carbon-emission intensities?

  201. BLOG

    Climate Matters: What’s in an ESG Rating. And What’s Not. 

    Nov 23, 2021 Meggin Thwing Eastman , Guido Giese , Zoltán Nagy

    ESG Research

    Learn More

    ESG ratings are widely used in active management and ESG indexes, with a growing focus on climate change. This has increased debate around two questions: Why are ESG ratings so different across providers? And how do ESG ratings reflect climate risk?

  202. BLOG

    Beginning to Understand the Performance of Social Properties 

    Nov 22, 2021 Bert Teuben

    Real Estate Investing

    Learn More

    The precise measurement of social impact is in its early stages. But some property sectors like affordable housing have obvious links to social themes, and investment in these “social properties” has increased significantly over the last 10 years.

  203. BLOG

    Controlling Idiosyncratic Risk in Value Strategies 

    Nov 18, 2021 Waman Virgaonkar , Mehdi Alighanbari

    Factor Investing

    Learn More

    We looked at ways to mitigate some of the performance drag of stock-specific risk on value strategies over the last decade by directly controlling for this risk without negatively affecting value-factor exposures or contributions.

  204. BLOG

    After Evergrande: Bond Liquidity of Chinese Property Developers 

    Nov 17, 2021 Daniel F. Molnar

    Fixed Income , Risk Management , Global Investing

    Learn More

    Evergrande, one of China’s largest and most indebted property developers, had a recent close brush with bankruptcy that generated considerable concern among global bond investors. In this time of distress, how has market liquidity responded?

  205. BLOG

    Can Green Spreads Uncover ESG's Influence on Bond Prices? 

    Nov 11, 2021 Greg Recine , Alexander Spray

    ESG Research , Fixed Income

    Learn More

    Investors increasingly seek to build portfolios that have reduced exposure to climate-transition risk. How might these changes in investor behavior have affected prices in the corporate-bond market?

  206. BLOG

    How Climate Change Affected Thirsty Chipmakers 

    Nov 9, 2021 Siping Guo

    ESG Research

    Learn More

    In the face of increasingly frequent and severe climate hazards around the globe, water constraints appear to be emerging as an important factor impacting the Taiwanese semiconductor industry and global supply chains.

  207. BLOG

    Focusing a Sustainability Lens on China’s Regulatory Changes 

    Oct 28, 2021 Shuo Xu

    Global Investing

    Learn More

    Market fundamentals may not be significantly affected by new regulations in China. But, given the regulations’ focus on ESG-related issues, investors can use ESG data as they seek to identify risks and opportunities across industries and securities.

  208. BLOG

    How Climate Change Could Impact Credit Risk 

    Oct 20, 2021 Reka Janosik , Thomas Verbraken

    ESG Research , Fixed Income , Risk Management

    Learn More

    Investors are increasingly focused on gauging the risks related to climate change. We investigated how various climate scenarios could impact the credit risk of portfolios. In one scenario, 16% of investment-grade issuers could migrate to high yield.

  209. BLOG

    Could Factors Help Explain Asset-Level Real Estate Performance? 

    Oct 19, 2021 Bryan Reid , Fritz Louw

    Real Estate Investing , Factor Investing

    Learn More

    For real estate investors, property type and geography segmentations are the primary lens through which they measure and manage their portfolios. Testing five potential real estate style factors, however, were we able to better explain asset-level variation.

  210. BLOG

    How to Achieve Net Zero? Leaders Weigh In 

    Oct 18, 2021 Meggin Thwing Eastman

    Global Investing

    Learn More

    How can investors help accelerate the net-zero transition? This was the central question at MSCI’s 2021 Global Investing Conference. We present the core takeaways from the two-day event, which featured senior corporate and investment thought leaders.

  211. BLOG

    Understanding Carbon Exposure in Private Assets 

    Oct 14, 2021 Manish Shakdwipee

    ESG Research

    Learn More

    Public companies and managers of listed assets face growing disclosure requirements. But private companies have not received the same level of scrutiny. How can investors in private assets calculate their exposure to carbon emitters, and what can they do about it?

  212. BLOG

    Creeping Crypto: Cryptocurrency Risk and ESG 

    Oct 13, 2021 Harlan Tufford , Nigel Fletcher , Siyu Liu , Aura Toader

    ESG Research

    Learn More

    Institutional investors may have more exposure to cryptocurrency risk than they realize. We find that cryptocurrencies were a part of business for at least 52 companies covered by MSCI ESG Research, including 26 MSCI ACWI Index constituents.

  213. BLOG

    Stress Testing Portfolios for Climate-Change Risk 

    Oct 7, 2021 Nathan Faigle , Simone Ruiz-Vergote

    ESG Research

    Learn More

    How quickly companies implement net-zero pledges can affect the value of investments. Stress testing can be used to test how the valuation of a portfolio could change under different climate transition speeds or scenarios chosen by the investor.

  214. BLOG

    Factors in Focus: Where’s the Value in Defensive Positioning? 

    Oct 1, 2021 Waman Virgaonkar , Hitendra D Varsani

    Factor Investing

    Learn More

    Throughout the third quarter, investors shifted attention to risks from inflation, tapering and potential interest-rate rises. We analyze global equities and the rotation toward defensive factors.

  215. BLOG

    Constructing Net-Zero Portfolios: Three Approaches 

    Sep 30, 2021 Guido Giese , Zoltán Nagy , Chris Cote

    ESG Research

    Learn More

    While investors around the world are committing to bring the carbon footprints of their portfolios to net-zero by 2050, figuring out how to do so is not a simple matter. What alternatives do investors have?

  216. BLOG

    Industry Momentum Across Regions 

    Sep 27, 2021 Waman Virgaonkar , Mehdi Alighanbari

    Factor Investing

    Learn More

    We expand on our analysis of industry momentum to assess the persistence of a premium across different regions and the ability of a rules-based strategy to help investors as they seek to capture this premium.

  217. BLOG

    Real Estate’s Income Risk in the Wake of COVID-19 

    Sep 21, 2021 Fritz Louw

    Real Estate Investing

    Learn More

    COVID-19 has weighed heavily on the financial positions of companies that hold leases for commercial real estate. Property investors can track the covenant quality of their tenants and translate it into a probability of default over the length of the lease.

  218. BLOG

    The Impact of China’s New Regulations: A Thematic Lens 

    Sep 15, 2021 Wei Xu

    Global Investing

    Learn More

    Regulatory changes in China have investors wondering how different industries could be affected. Evaluating the changes through a thematic lens can provide insight into the growth and crowding levels of megatrends, as industries react and evolve.

  219. BLOG

    Measuring the Temperature of Your Portfolio 

    Sep 14, 2021 Simone Ruiz-Vergote

    ESG Research

    Learn More

    Institutional investors are setting targets to align their portfolios with a 1.5˚-2°C global warming scenario. But measuring and reporting portfolio temperature rise remain challenging. How can investors measure the temperature of their portfolios?

  220. BLOG

    Regulatory Risk Rises for South Korean Employers 

    Sep 14, 2021 S.K. Kim

    ESG Research

    Learn More

    Are South Korean companies ready to deal with the country’s new workplace-safety law? Our research finds that many of those companies — often located in the machinery and metals and mining industries — are ill-prepared.

  221. BLOG

    How a Shift Toward Buybacks Affected Yield Strategies 

    Sep 3, 2021 Mehdi Alighanbari , Arihant Jain

    Global Investing , Factor Investing

    Learn More

    For investors who use yield strategies to generate income, a steady stream of dividend payments is important. But with more companies using buybacks as a way to redistribute profits, investors may want to consider a more holistic view of income.

  222. BLOG

    Benchmarking Pan-Regional Real Estate Funds 

    Sep 2, 2021 Will Robson

    Real Estate Investing

    Learn More

    Real estate investors have increasingly sought pan-regional funds to diversify globally. But such funds’ exposures can be significantly different from the market at large. What’s an appropriate benchmark for these diversified fund investments?

  223. BLOG

    Regulatory Risk Rises for South Korean Employers 

    Sep 1, 2021

    ESG Research

    Learn More

    Are South Korean companies ready to deal with the country’s new workplace-safety law? Our research finds that many of those companies — often located in the machinery and metals and mining industries — are ill-prepared.

  224. BLOG

    Building Climate-Aware Factor Portfolios 

    Aug 31, 2021 Chirag Gosar , Padmakar Kulkarni

    Factor Investing

    Learn More

    Factor investing typically involves both security selection and alternative weighting based on security-level factor exposure. If such a strategy also needs to be climate-aware, what is the cost in terms of target-factor erosion?

  225. BLOG

    A Sector-Balanced Approach to China A Mega-Cap Exposure 

    Aug 27, 2021 Shuo Xu , Zhen Wei

    Global Investing

    Learn More

    For investors seeking exposure to the mega-cap segment of the China A market, a simple top-50 market-cap-weighted approach can lead to large sectoral biases. We explore how a balanced mega-cap approach may help.

  226. BLOG

    Sizing Up Small Caps 

    Aug 25, 2021 Abhishek Gupta , Ashish Lodh

    Factor Investing

    Learn More

    Given small-cap outperformance since March 2020, investors are asking how these stocks size up in terms of short-term valuation, sentiment and macro outlook? Longer term, might small caps help capture opportunities around thematic investing megatrends?

  227. BLOG

    Housing-Bubble Déjà Vu 

    Aug 10, 2021 Joy Zhang , David Zhang

    Risk Management

    Learn More

    The U.S. in the past year recorded the highest national house-price appreciation in recent decades. Does the run-up in home prices represent housing-bubble déjà vu? And what can MBS investors do to assess their mortgage credit risk?

  228. BLOG

    Assessing Private Infrastructure in a Multi-Asset-Class Portfolio 

    Aug 4, 2021 Michael Hayes , Yang Liu

    Real Estate Investing , Risk Management

    Learn More

    Private infrastructure is a popular element of institutional capital allocations, and increased focus on renewable or carbon-neutral infrastructure may mean significant new investment opportunities. What role could it play in a multi-asset-class portfolio?

  229. BLOG

    Fresh IPO Stocks and Indexes: In or Out? 

    Aug 3, 2021 Arihant Jain , Mehdi Alighanbari

    Global Investing

    Learn More

    Depending on a number of factors, stocks may be added to indexes soon after a company’s IPO, which can affect asset managers who use the indexes to create and benchmark portfolios. We investigate the impact of IPO stocks on index performance.

  230. BLOG

    Managing Against MBS Indexes: A Duration Perspective 

    Jul 30, 2021 Yihai Yu , Anant Bhatnagar

    Fixed Income , Risk Management

    Learn More

    Mortgage-backed securities constitute a significant portion of fixed-income indexes. Managing MBS portfolios against these indexes depends heavily on an understanding of the dynamics of MBS duration, especially in volatile markets.

  231. BLOG

    Could Factors Have Explained Cryptocurrency Risk? 

    Jul 29, 2021 Daniel R. Barrera , Simon Minovitsky

    Factor Investing

    Learn More

    As cryptocurrencies rise in popularity as investment vehicles, the need for standardized tools for this market increases as well. We created a multifactor model to measure whether factors important for equity markets were also important for crypto.

  232. BLOG

    Are SPACs Riskier than Conventional IPOs? 

    Jul 27, 2021 Nilufar Kuchimova , Ahasan Amin

    ESG Research

    Learn More

    SPACs exploded in popularity in 2020, but these “blank-check” shell IPOs offer some unusual governance risks to investors. In this blog post, we examine some of the challenges.

  233. BLOG

    Credit Strategies During the COVID-19 Crisis 

    Jul 27, 2021 Chenlu Zhou , Shuyin Hua

    Fixed Income , Risk Management

    Learn More

    Short-term credit spreads widened to a greater extent than long-term spreads during the March 2020 COVID-19 crisis. As a result, many U.S. corporate-issuer spread curves flattened or even inverted. What were the implications for corporate-bond investors?

  234. BLOG

    COVID-19’s Uneven Impact on Office Vacancy 

    Jul 26, 2021 Niel Harmse

    Real Estate Investing , Global Investing

    Learn More

    What was the precise impact of the COVID-19 crisis on office properties? While the overall vacancy rate at the end of 2020 was lower than the previous cycle’s peak, the percentage of fully leased office buildings reached an all-time low.

  235. BLOG

    What Could a Rate Hike Mean for Portfolios? 

    Jul 22, 2021 Daniel Szabo , Thomas Verbraken

    Fixed Income , Risk Management

    Learn More

    Although the Federal Reserve may not begin raising rates anytime soon, U.S. and global markets are scrutinizing the Fed’s communications about the likely course of policy actions. We consider three scenarios for the timing of policy responses.

  236. BLOG

    Are APAC’s High-ESG-Risk Stocks Cleaning Up Their Act? 

    Jul 20, 2021 Miranda Carr

    ESG Research

    Learn More

    The APAC region’s ESG performance has suffered from a combination of low ESG adoption and awareness and limited ESG regulation and reporting. But marked improvements are surfacing in environmental and social performance in certain sectors

  237. BLOG


    Jul 20, 2021 Miranda Carr

    ESG Research

    Learn More

    亚太市场公司的MSCI ESG评级通常低于全球同业公司。但这种情况正在快速变化,即使是某些表现最差的行业(例如能源和原材料)也开始改善其ESG实践。

  238. BLOG

    Hedging Inflation with Equities 

    Jul 16, 2021 Ashish Lodh , Jean-Maurice Ladure

    Global Investing , Factor Investing

    Learn More

    Equities have traditionally been viewed as a hedge against inflation, based on the assumption that companies’ revenues adjust for inflation over time. But what has been the short-term impact on equity portfolios?

  239. BLOG

    How Might Inflation Impact Funding Ratios? 

    Jul 14, 2021 Monika Szikszai , Thomas Verbraken , Puneet Kumar

    Risk Management

    Learn More

    We analyzed two multiperiod inflation scenarios to understand how the funding ratios of defined-benefit pension funds could evolve in each and what they could mean for a pension fund in terms of special contributions over the next 10 years.

  240. BLOG

    Active-Management Opportunities in a Disperse Market 

    Jul 13, 2021 Hitendra D Varsani , Rohit Gupta

    Factor Investing

    Learn More

    Disperse markets have historically provided opportunities for active managers to outperform their respective benchmarks. We showed that, based on historical trends, CSV helped shed light on identifying where the dispersion was greatest.

  241. BLOG

    What Can Liquidity Tell Us About ETF Prices? 

    Jul 9, 2021 Laszlo Hollo

    Integrated Risk Management , Risk Management

    Learn More

    As thematic equity ETFs have grown in popularity, concerns have been raised about their liquidity — especially when an ETF holds a large fraction of a constituent’s shares. How can ETF investors get a handle on this risk? 

  242. BLOG

    Eyeing the Crowds from Multiple Perspectives 

    Jul 8, 2021 George Bonne , Jay Yao , Howard Zhang

    Factor Investing

    Learn More

    We observed historically notable crowding across factors, industries and stocks through the first half of 2021. Examining crowding from multiple perspectives and incorporating multiple data elements provides investors a more holistic view. 

  243. BLOG

    Chinese RMBS: A Way to Diversify Fixed-Income Portfolios? 

    Jul 7, 2021 Jian Chen , Yihai Yu

    Fixed Income

    Learn More

    The market in Chinese residential mortgage-backed securities is growing, as global investors are eying the segment’s relatively high yield and potential for diversification, but seeking improved credit ratings and transparency in data and pricing.

  244. BLOG

    Factors in Focus: Go with the Flow? 

    Jul 1, 2021 Waman Virgaonkar , Hitendra D Varsani

    Factor Investing

    Learn More

    In the latest edition of Factors in Focus, we look at flows into equity factor ETFs and whether it has been profitable, historically, to follow the money, along with our analysis of factor and factor-index performance over the second quarter.

  245. BLOG

    Purifying Value 

    Jun 29, 2021 Waman Virgaonkar , Mehdi Alighanbari

    Factor Investing

    Learn More

    Unintended exposure to non-value factors was a large contributor to value’s period of underperformance. We investigate value-portfolio construction when controlling for these exposures while maintaining maximum exposure to value factors.

  246. BLOG

    Translating Climate Goals into Action in Real Estate Portfolios 

    Jun 28, 2021 Will Robson , Niel Harmse

    Real Estate Investing

    Learn More

    Many investors have made bold commitments to transition their real estate portfolios to net-zero carbon emissions and are now developing and implementing plans to achieve this goal. But what could this transition look like in practice for property portfolios?

  247. BLOG

    Securitized Products’ LIBOR Transition Picking Up Pace 

    Jun 22, 2021 Vikram Tuteja , Yihai Yu

    Fixed Income

    Learn More

    In 2021, there has been significant progress in the transition from the LIBOR reference rate to its replacement, SOFR. But investors in securitized products are grappling with the challenge of the LIBOR-SOFR transition and its impact on their analytics.

  248. BLOG

    CDS Fading as a Measure of Value in Emerging Markets 

    Jun 17, 2021 Zoltan Fekete , Reka Janosik

    Fixed Income

    Learn More

    Credit investors use spreads to compare relative value and risk. Studies of emerging-market sovereign debt have shown that credit-default swaps tended to be a better measure of value than spreads computed from bonds. But is it still the case?

  249. BLOG

    What Can Loan-Level Data Reveal About US Auto-Loan ABS? 

    Jun 15, 2021 Yini Yang , Joy Zhang

    Fixed Income , Risk Management

    Learn More

    U.S. regulators required issuers by Nov. 23, 2016, to disclose data on individual loans bundled into auto-loan asset-backed securities. We looked at whether incorporating loan-level data into our model could sharpen our analysis of this ABS segment.

  250. BLOG

    Escaping to Equities for Yield 

    Jun 10, 2021 Arihant Jain , Mehdi Alighanbari

    Factor Investing

    Learn More

    In today’s low-rate world, some investors shifted toward historically higher-yielding equities. For others, especially in the insurance industry, the greater risk limited their ability to do so. Was a minimum-variance equity approach a viable option?

  251. BLOG

    Mining’s Impact on Biodiversity: A Rising Risk? 

    Jun 9, 2021 Samuel Block , Gillian Mollod

    ESG Research

    Learn More

    Will biodiversity losses become the next crisis facing humanity, possibly surpassing climate change? Growing scrutiny on biodiversity risks could have implications for mines that threaten biodiversity or environments of high conservation value.

  252. BLOG

    Mining Energy-Transition Metals: National Aims, Local Conflicts 

    Jun 3, 2021 Samuel Block

    ESG Research

    Learn More

    Investors are scouting for companies that mine the metals needed in new energy technologies. But some mining projects key to the transition from fossil fuels may face opposition from Native Americans for threatening sacred areas or traditional ways of life.

  253. BLOG

    Momentum on a Value Hunt 

    Jun 2, 2021 Abhishek Gupta , Ashish Lodh

    Global Investing , Factor Investing

    Learn More

    Momentum, by definition, rotates into securities with recent outperformance. That said, investors who view value and momentum as contra-signals may have questions about the value-momentum convergence and the divergence of momentum and growth.

  254. BLOG

    Exxon Mobil: Drilling Down on the Proxy Vote 

    Jun 1, 2021 Harlan Tufford , Ric Marshall

    ESG Research

    Learn More

    The historic win of at least two seats on Exxon Mobil’s board by activist shareholder Engine No. 1 signals a dramatic shift in investors’ thinking about climate change — and in their willingness to vote for climate action. But there is a deeper story.

  255. BLOG

    Bitcoin: Good as Gold? 

    May 26, 2021 Daniel R. Barrera , Simon Minovitsky

    Factors , Risk Management

    Learn More

    During inflationary periods, equity investors, historically, have turned to gold as a hedge and diversifier. As the issue of inflation becomes more pressing, we ask whether cryptocurrencies, such as Bitcoin, could have played a similar role.

  256. BLOG

    Real Estate’s Climate-Transition Risk: The Path to Net-Zero 

    May 25, 2021 Will Robson

    Real Estate Investing , Risk Management , Global Investing

    Learn More

    The 2015 Paris Agreement seeks to keep the rise in global temperature to well below 2 degrees Celsius above pre-industrial levels, and many governments are aiming for 1.5°C through nationally determined contributions. What are the implications for real estate markets?

  257. BLOG

    Race & Ethnicity Disclosure: US Companies’ Rocky Start 

    May 19, 2021 Christina Milhomem

    ESG Research

    Learn More

    Violence against the Black and Asian American communities in the U.S. has put racial injustice in the global spotlight. But the lack of standardization in reported data on race and ethnicity has greatly hindered comparability.

  258. BLOG

    The Pressure of the Crowd: Stress Testing Thematic Indexes 

    May 17, 2021 Anil Rao , Thomas Verbraken

    Equity Themes , Risk Management , Global Investing

    Learn More

    Some investors may be concerned about crowding within the fast-growing thematic-investing segment. Using MSCI’s stock-crowding model, we identify crowded themes and run stress tests to understand how they might respond to an equity sell-off.

  259. BLOG

    What Really Drove Value and Growth Fund Performance? 

    May 14, 2021 Abhishek Gupta , Guillermo Cano

    Factor Indexes , Factors

    Learn More

    Many look to market-cap indexes when comparing the performance characteristics of growth and value funds — including manager skill. We found a switch to style indexes reduced industry- and style-factor contributions and made manager skill more apparent.

  260. BLOG

    Are Your Clients Ready for US Tax Day? 

    May 10, 2021 Raina Oberoi , Yuliya Plyakha Ferenc , Joseph Wickremasinghe , Paulina Serrano

    Risk Management

    Learn More

    Given the complexity of U.S. tax regulation, wealth advisers continue to grapple with how to build tax-efficient portfolios while balancing clients’ other objectives. We propose a rules-based way of doing so and analyze its benefits and trade-offs.

  261. BLOG

    Why Is Climate-Transition Risk High in High Yield? 

    May 6, 2021 Bruno Rauis , Juan Sampieri , Andy Sparks

    ESG Research , Fixed Income , Risk Management

    Learn More

    Investors increasingly focus on building greener portfolios. Some might expect bonds to be less exposed to climate-transition risk compared to equities, due to the seniority of bonds in the capital structure. But does that logic hold at the portfolio level?

  262. BLOG

    The Theory of (Value) Relativity 

    May 5, 2021 Waman Virgaonkar , Mehdi Alighanbari

    Factor Investing

    Learn More

    Whether constructing a fundamental factor model, a value strategy or a value index, valuation ratios need context. Time-series and cross-sectional approaches each have pros and cons. But combining the two may have presented a clearer picture. 

  263. BLOG

    Bringing Value to the 21st Century 

    Apr 28, 2021 Arihant Jain , Mehdi Alighanbari , Saurabh Katiyar

    Factors , Global Investing

    Learn More

    In the second post in our series, we further probe value’s underperformance over the past decade and ask if the historic definition of value remains relevant. We specifically look at whether a company’s valuation can be enhanced by reflecting R&D investments. 

  264. BLOG

    How Office Real Estate Performed amid COVID 

    Apr 27, 2021 Niel Harmse

    Real Estate Investing

    Learn More

    COVID-19 disrupted real estate across countries and property segments. The biggest initial impacts were felt in retail, leisure and hotels. But more recently, the performance of listed offices has lagged.

  265. BLOG

    Modern Slavery: The Unseen Risks 

    Apr 26, 2021 Morgan Ellis

    ESG Research , Global Investing

    Learn More

    Modern slavery occurs all over the world and can impact virtually all industries. Meanwhile, regulations requiring more detailed reporting on potential supply-chain exposure is increasing. How can investors identify portfolio holdings most at risk?

  266. BLOG

    Factor Investing Held in High-Volatility/-Concentration Period 

    Apr 23, 2021 Abhishek Gupta , Ashish Lodh

    Factor Indexes , Factors , Risk Management

    Learn More

    U.S. equity markets have experienced increased volatility coupled with concentration in a handful of megacap companies. Has this hampered investors’ ability to capture factors effectively? Have stock-specific risks dominated factor indexes?

  267. BLOG

    Some ESG Funds Are Not Like the Others 

    Apr 19, 2021 Rumi Mahmood

    ESG Research , Global Investing

    Learn More

    ESG funds’ holdings can vary significantly, depending on their objectives, methodologies and geographic exposures. We examined the 20 largest equity funds in our coverage universe.

  268. BLOG

    Could Investment Grade Be as Risky as High Yield? 

    Apr 16, 2021 András Bohák , Andras Rokob

    Fixed Income , Risk Management

    Learn More

    Do high-yield and investment-grade bonds carry the same level of risk? For investors using common measures like value-at-risk models, IG- and HY-bond portfolios’ risk levels appear to have converged. But traditional models may miss important aspects of HY risk.

  269. BLOG

    Innovation Remix: Adding Thematics to Equity Programs 

    Apr 14, 2021 Raman Aylur Subramanian , Anil Rao , Subramanian Aylur

    Equity Themes , Factor Indexes , Global Investing

    Learn More

    How can investors incorporate transformative, but volatile thematic investments while seeking to control for valuation and total and active risk? We examine three approaches that improved a portfolio’s “innovation profile” with modest changes to risk.

  270. BLOG

    Long-Horizon Risk: The Past 50 Years 

    Apr 13, 2021 Monika Szikszai , Thomas Verbraken

    Fixed Income , Risk Management

    Learn More

    For long-horizon investors that aim to ride out volatility, short-term risk measures may be insufficient. We used multiperiod stress testing to evaluate one- and five-year returns of hypothetical multi-asset-class portfolios using 50 years of history.

  271. BLOG

    Including Microcaps in Benchmark Indexes: Japan vs. US 

    Apr 7, 2021 Naoya Nishimura

    Equity Themes , Global Investing , Factor Investing

    Learn More

    Selecting an equity benchmark may mean balancing market coverage and investability. For example, exhaustive coverage may include microcap stocks, with lower liquidity and investment capacity. But excluding them may reduce low-size-premium exposure.

  272. BLOG

    Factors in Focus: Value Springs into Action 

    Apr 6, 2021 Hitendra D Varsani , Waman Virgaonkar

    Factor Indexes , Factor Investing

    Learn More

    Value has historically outperformed in economic recoveries. With the reopening of the global economy we examined value’s performance against other factors, and exposures from our adaptive multi-factor model at the end of Q1. 

  273. BLOG

    Reopening Economies and the Resurgence in Value 

    Mar 31, 2021 Waman Virgaonkar , Hitendra D Varsani

    Factor Indexes , Global Investing , Factor Investing

    Learn More

    After 15 years of challenging performance, many have asked if value is still a valid investment strategy. But the reopening of the global economy following vaccination rollouts has reignited interest across stocks, sectors, countries and regions.

  274. BLOG

    Open- vs. Closed-End Real Estate Funds: How the Choice Mattered 

    Mar 30, 2021 Luis O’Shea , Bryan Reid , Bert Teuben

    Real Estate Investing

    Learn More

    The aggregate performance of closed- and open-end real estate funds in the U.S. was strikingly similar in recent years, despite large differences in their strategy and roles in portfolios. But did some investors gain an edge through fund selection?

  275. BLOG

    Value-Performance Anxiety 

    Mar 23, 2021 Mehdi Alighanbari , Saurabh Katiyar

    Global Investing , Factor Investing

    Learn More

    Despite a recent performance lift, many still ask whether the value factor is broken. We analyze the reasons behind its underperformance and start exploring the potential of updates to value definitions and approaches to value-portfolio construction.

  276. BLOG

    CEO Compensation: Paying Up for Mediocrity 

    Mar 22, 2021 Harlan Tufford

    ESG Research

    Learn More

    Are companies aligning CEO pay with long-term performance? Or, put another way, are directors incentivizing executives to drive the long-term success of the companies they run? We found evidence that pay and performance are misaligned for many U.S. CEOs.

  277. BLOG

    Considerations for Dedicated China Equity Allocations 

    Mar 18, 2021 Zhen Wei , Wei Zhen

    Emerging Markets , Global Investing

    Learn More

    China provides global equity investors a unique set of opportunities and challenges as they evaluate a potential dedicated investment program and how to approach asset allocation from policy configuration to portfolio implementation.

  278. BLOG


    Mar 18, 2021 Zhen Wei

    Emerging Markets , Global Investing

    Learn More


  279. BLOG

    Managing the Risks of LIBOR Replacement 

    Mar 17, 2021 Greg Scheuer , Maks Oks

    Fixed Income , Risk Management , Global Investing

    Learn More

    Investors now have clarity on the process of transitioning away from LIBOR and falling back on replacement benchmark rates. We used stress tests to show that fallback modeling may be necessary to measure and manage the risks of LIBOR instruments.

  280. BLOG

    The Pace of Fast Change: Growth vs. Thematic Investing 

    Mar 16, 2021 Anil Rao , Stuart Doole

    Factor Indexes , Factors , Global Investing , Factor Investing

    Learn More

    Investors considering thematic investments to gain exposure to firms whose fortunes may not be captured by fundamental growth measures, may ask: What are the key opportunities – and challenges – that distinguish thematic from growth investing?

  281. BLOG

    Is There a Hedge-Fund-Crowding Factor? 

    Mar 10, 2021 Howard Zhang , George Bonne

    Factor Investing

    Learn More

    Hedge funds held heavy, relatively illiquid short positions in crowded stocks before the January 2021 short squeeze. We created a risk factor that added explanatory power and may provide insights into potential short squeezes and other risks.

  282. BLOG

    Are Growth and Value Indexes Still in Style? 

    Mar 9, 2021 Guillermo Cano , Abhishek Gupta

    Factor Investing , Risk Management , Global Investing

    Learn More

    Growth and value indexes were created in the 1980s as finer tools than market-cap indexes to measure the performance of growth and value funds. Are style-specific indexes still a relevant choice to use as benchmarks for these funds?

  283. BLOG

    Women on Boards: The Hidden Environmental Connection? 

    Mar 8, 2021 Christina Milhomem

    ESG Research

    Learn More

    With social inequality gaining prominence ahead of the 2021 proxy season, investors and other stakeholders are increasingly vocal about the need for greater diversity in corporate boardrooms. How successful have boards been globally?

  284. BLOG

    How Inflation Could Affect Multi-Asset-Class Portfolios 

    Mar 3, 2021 Thomas Verbraken , Daniel Szabo

    Real Estate Investing , Fixed Income , Global Investing , Integrated Risk Management

    Learn More

    Market participants are hotly debating whether U.S. monetary and fiscal policy may cause inflation. We consider four scenarios — reflation, disinflation, an overheated economy and stagflation — and their potential impact on multi-asset-class portfolios.

  285. BLOG

    How Have Stocks Responded to Changes in Climate Policy? 

    Mar 1, 2021 Guido Giese , Zoltán Nagy , Bruno Rauis

    ESG Research , Global Investing

    Learn More

    To what extent has climate risk been priced into equity markets? Is there a “brown” discount and a “green” premium? Has this shifted over time? How can we model such risks as the world moves toward net-zero targets? We examine the financial impact of climate transition risk on global equity markets.

  286. How much does ESG contribute to portfolio risk and return? We looked at whether ESG performance was influenced by other factors or helped explain returns as a factor in its own right, using the MSCI Global Equity Factor Model + ESG.

  287. BLOG

    Finding the Sentiment Hidden in Regulatory Filings 

    Feb 24, 2021 Vipul Jain , Kunal Jha

    Factor Investing

    Learn More

    Using natural language processing techniques, we constructed a sentiment factor that quantifies changes in the tone and content of company filings, and may be an indicator of future risks facing a company.

  288. BLOG

    Climate Transition and Bonds: Risk or Opportunity? 

    Feb 23, 2021 Bruno Rauis , Juan Sampieri , Andy Sparks

    ESG Research , Fixed Income , Risk Management

    Learn More

    The transition to a low-carbon economy could significantly redirect the flow of investments toward greener companies and technologies that limit carbon emissions. We consider the potential risk — and opportunity — for bond investors.

  289. BLOG

    Currency-Risk Hedging in Real Estate Benchmarks 

    Feb 22, 2021 Bert Teuben , Lionel Ebener , Chirag Gosar

    Real Estate Investing , Risk Management , Global Investing

    Learn More

    Global real estate investors can expose themselves to currency risk. Using a hedged index, they may better align their benchmark and investment approach and ensure currency risk is accurately treated in allocation modeling and performance attribution.

  290. BLOG

    A New COVID-19 Regime for MBS? 

    Feb 17, 2021 Yihai Yu , Miklós Vörös

    Fixed Income , Integrated Risk Management

    Learn More

    In 2020, the Federal Reserve’s purchases of mortgage-backed securities, low interest rates, mortgage-underwriting policy changes and technology advancements led to a historic refinance frenzy and posed an unprecedented challenge for MBS risk management.

  291. BLOG

    Are (Stock) Bubbles Rising? 

    Feb 12, 2021 George Bonne , Howard Zhang , Jay Yao

    Factor Investing

    Learn More

    How does one identify or quantify a bubble? We propose a framework for assessing the “bubbliness” of stocks and portfolios, rooted in the idea that bubbles are driven by the same forces, and share characteristics with crowded trades.

  292. BLOG

    Cross-Currency Credit Spreads: Mind the Gap 

    Feb 8, 2021 Michael Hayes , Zach Tokura

    Fixed Income , Risk Management

    Learn More

    An issuer’s credit spread should be consistent when measured in the USD- or EUR-denominated markets, because both are measuring the same credit risk. Yet divergence can occur as a result of liquidity or supply-demand imbalances, such as those in the COVID crisis.

  293. BLOG

    How Are High-ESG-Rated Bond Portfolios Distinct? 

    Feb 5, 2021 Hitendra D Varsani , Rohit Mendiratta , Guido Giese

    Fixed Income , Risk Management , ESG Research

    Learn More

    ESG investing makes up an increasingly large footprint in equity portfolios, but ESG integration in bond portfolios is still in its early days. We examine the characteristics that make high-ESG-rated corporate-bond portfolios distinct.

  294. BLOG

    COVID Stimulus Helped Resilience of US ABS 

    Jan 29, 2021 Yini Yang , Joy Zhang

    Risk Management , Fixed Income

    Learn More

    Issuance of U.S. asset-backed securities fell by a quarter in 2020 from the previous year, as credit tightened during the COVID-19 crisis. The performance of loans underpinning ABS proved resilient, however, as economic relief helped support consumers.

  295. BLOG

    Stress Testing Climate-Change Scenarios 

    Jan 28, 2021 David Lunsford , Thomas Verbraken

    Global Investing , ESG Research

    Learn More

    Regulators around the world are upping the ante on climate-related financial disclosures. How can investors stress test potential exposures to these changes in policy? We take a look within Europe.

  296. BLOG

    An ‘ESG-First’ Approach to Portfolio Construction 

    Jan 19, 2021 Jean-Maurice Ladure , Ashish Lodh

    ESG Research

    Learn More

    A new administration in the U.S. and ESG-related regulations in Europe may further increase investors’ sustainability focus. We examine an “ESG-first” approach to integrating measurable ESG and climate considerations into portfolios.

  297. BLOG

    What Biden’s Climate Plan Means for US Utilities 

    Jan 14, 2021 Velina Karadzhova , Umar Ashfaq

    ESG Research

    Learn More

    Joe Biden is targeting net-zero carbon emissions in the United States by 2050, but the target date for electricity generation would come 15 years sooner. Are the U.S. utilities sector and investors prepared for net-zero emissions by 2035?

  298. BLOG

    Carrying on Through a Crisis, with Factors 

    Jan 13, 2021 Andrew DeMond , Manuel Rueda

    Factor Investing , Risk Management , Fixed Income

    Learn More

    Factors have long had a place in constructing equity portfolios, but investors increasingly use factors in sovereign and corporate bonds, commodities and currencies. Which non-equity factors have been the best performers coming out of recent crises, and why?

  299. BLOG

    2021 Real Estate Trends to Watch 

    Jan 12, 2021 Will Robson

    Real Estate Investing

    Learn More

    COVID-19 has caused a severe and rapid economic contraction and accelerated secular changes already hitting parts of the real estate markets. Investors face a fundamental question: How will real estate evolve as a sector and asset class? Here are our 2021 real estate trends to watch.

  300. BLOG

    Factors in Focus: Val-come Back! Shifting Factors as the Cycle Turns 

    Jan 6, 2021 Hitendra D Varsani , Waman Virgaonkar

    Factor Investing

    Learn More

    In this two-year-anniversary edition of Factors in Focus, we reflect on the historical relationships between factor returns and macro cycles, which have provided useful information for investors looking to take an active stance on factor exposures based on their outlook.

  301. BLOG

    A Thematic Lens for Portfolios 

    Dec 17, 2020 Stuart Doole , Kumar Neeraj , Vishad Bhalodia

    Global Investing

    Learn More

    We show how MSCI Thematic Exposure relevance scores helped position growth funds, as an example, alongside thematic funds, and highlighted key megatrends that drove performance. A thematic lens can help analyze other categories and strategies as well.

  302. BLOG

    The Doctor Is Making House Calls: Capturing Exposure to Telehealth 

    Dec 16, 2020 Manuel Rueda , Gaurav Trivedi

    Factor Investing , ESG Research

    Learn More

    Telehealth has the potential to reduce inequalities in access to care as well as relieve strain on health systems. We tested an approach that combines natural-language processing and MSCI ESG Ratings screens.

  303. BLOG

    Kuwait’s Move from Frontier to Emerging Market 

    Dec 14, 2020 Saurabh Katiyar , Ashish Lodh

    Global Investing

    Learn More

    Kuwait’s reclassification from frontier to emerging market and inclusion in the MSCI Emerging Markets Index provides investors exposure to yet another Gulf Cooperation Council member, one that has worked to open its doors to foreign investors.

  304. BLOG

    Accounting for Revenue Sources Tells a Richer Story 

    Dec 11, 2020 Jean-Maurice Ladure

    Global Investing , Emerging Markets , Economic Exposure

    Learn More

    Despite North America’s outsized weighting in the MSCI ACWI Index, companies in the index generated only 30% of their global revenues there. We explore how examining revenue sources may help uncover opportunities of economic growth around the world.

  305. BLOG

    Is ESG Investing a Price Bubble? Probably Not. 

    Dec 9, 2020 Guido Giese , Navneet Kumar , Zoltán Nagy

    ESG Research

    Learn More

    Inflows into ESG funds have soared in recent years and months, in part motivated by outperformance since the COVID-19 pandemic erupted. But have these inflows become a self-fulfilling prophecy, creating an ESG bubble?

  306. BLOG

    Private-Infrastructure Risk: Tilting at Windmills 

    Dec 8, 2020 Yang Liu , Sheng Yao

    Risk Management

    Learn More

    Private-infrastructure investments are often treated as comparable to relatively safe long-duration bonds with attractive yields, but this approach can mislead investors as they evaluate risk, yield and portfolio hedges.

  307. Climate. ESG bubbles. Disclosure. Social inequality. Biodiversity. The topics don’t get much bigger — or more systemic. Here’s our analysis of the five ESG trends that will matter most to companies and their investors in 2021.

  308. ESG投资已日趋成熟,炒作和怀疑已经消退,但寻求实现《巴黎协定》目标的投资者开始发现,符合《巴黎协定》要求的投资机会越来越少。

  309. BLOG

    China Tech Investing: An Indexed Approach 

    Dec 2, 2020 Wei Xu , Kumar Neeraj , Devika Ghate

    Global Investing

    Learn More

    China’s emergence as a tech leader holds great potential. But its technology value chain isn’t limited to IT firms. Opportunity lies across sectors, from electric vehicles to medical devices. How does one effectively gain exposure?  

  310. BLOG


    Dec 2, 2020 Wei Xu , Kumar Neeraj , Devika Ghate

    Global Investing

    Learn More


  311. BLOG

    COVID-19 and Office Income: What Could Lie Ahead? 

    Nov 25, 2020 Fritz Louw

    Real Estate Investing

    Learn More

    With new COVID-19 lockdowns and swaths of white-collar workers working from home, many office tenants are contemplating whether the future of work includes office space. This could have significant impact on office demand and income from leases.

  312. BLOG

    How Diversified Are US Equity Investors? 

    Nov 24, 2020 Oleg Ruban

    Global Investing

    Learn More

    The universe of stocks represented by the MSCI USA Index comprises over 600 securities. U.S. investors might assume there are ample opportunities for diversification and potential risk reduction in the domestic market. Is this assumption correct?

  313. BLOG

    The CDS Market Stayed Healthy amid COVID 

    Nov 23, 2020 Zoltan Fekete , Reka Janosik

    Risk Management

    Learn More

    Since the global financial crisis, many have expressed concern about the health and future of credit-default swaps. Could institutional investors find the liquidity they need to hedge credit risk in subsequent periods? We examine CDS liquidity during the COVID-19 crisis.

  314. BLOG

    Stress Testing Multiperiod Inflation Scenarios 

    Nov 19, 2020 Monika Szikszai , Thomas Verbraken

    Fixed Income , Risk Management

    Learn More

    Will inflation rear its ugly head in the U.S.? Although the outcome of the U.S. elections might have lowered inflation expectations, investors can prepare for scenarios where inflation goes up. In this stress test, we examine three scenarios for inflation over varying time horizons.

  315. BLOG

    Investor Reaction to US Elections and COVID-Vaccine Progress 

    Nov 18, 2020 Dimitris Melas , David Lunsford , Andy Sparks

    Factor Investing , Risk Management , ESG Research

    Learn More

    To gauge investor expectations after Joe Biden was declared winner of the U.S. election and good news broke about COVID vaccines, we surveyed 151 U.S.-based financial advisers. We examine the advisers’ views on the next 12 months and markets’ reaction since Election Day.

  316. BLOG

    Did Size Matter for Small-Cap Outperformance? 

    Nov 16, 2020 Roman Kouzmenko

    Factor Indexes , Factor Investing , Factors

    Learn More

    Good vaccine news on Nov. 9 drove unusual equity-index and factor returns, including in small caps. The MSCI USA Small Cap Index returned 3.03% that day vs. 0.82% for the MSCI USA Index. Was this due to the size factor, or was there a bigger story?

  317. BLOG

    Are Momentum’s Wings Finally Starting to Melt? 

    Nov 13, 2020 George Bonne , Jun Wang

    Factor Investing , Factors

    Learn More

    Positive vaccine news on Nov. 9 caused big moves in industry and style factors. Those hit hardest this year jumped, while previous high performers slumped. Did this mark new factors leadership and a long-awaited rotation from momentum to value?

  318. BLOG

    Chinese Government Bonds: Higher Yield, Less Risk? 

    Nov 12, 2020 Greg Recine , Juan Sampieri , Andy Sparks

    Global Investing , Risk Management

    Learn More

    Global investors’ interest in Chinese government bonds has risen, as these bonds offer higher yields than developed-market sovereign debt. For investors thinking about adding Chinese bonds to their portfolios, what could be the impact on portfolio risk?

  319. BLOG

    What ESG Ratings Tell Us About Corporate Bonds 

    Nov 11, 2020 Rohit Mendiratta , Hitendra D Varsani , Guido Giese

    ESG Research , Risk Management

    Learn More

    How did incorporating ESG factors affect the performance of corporate-bond portfolios? Did ESG add insights beyond credit ratings? How did ESG impact risk and performance of investment-grade and high-yield bonds? Short-dated versus long-dated bonds?

  320. BLOG

    ESG 评级告诉我们有关公司债券的哪些信息? 

    Nov 11, 2020 Rohit Mendiratta , Hitendra D Varsani , Guido Giese

    ESG Research , Risk Management

    Learn More


  321. BLOG

    Will Interest Rates Surge? Evidence from Options Markets 

    Nov 3, 2020 Greg Scheuer , Andy Sparks

    Fixed Income , Risk Management

    Learn More

    With long-term interest rates near record lows, conventional wisdom suggests that they can only go up. But the interest-rate option markets seem to be telling a different story — that rate decreases are also a distinct possibility.

  322. BLOG

    China A Shares: What Have We Learned? 

    Oct 30, 2020 Zhen Wei

    Emerging Markets , Global Investing

    Learn More

    In this first of a series of blogs covering specific index-inclusion stories, we explore China A shares’ inclusion in the MSCI Emerging Markets Index by looking back at how it occurred and what’s happened since with market and investor reaction.

  323. BLOG

    Zombies on Board: Investors Face the Walking Dead 

    Oct 28, 2020 Ric Marshall

    ESG Research

    Learn More

    Investors may think that zombies live only in people’s imaginations, but these brain-munching monsters can haunt corporate boardrooms for years, eating away at a fundamental shareholder right: the right to duly elected representation.

  324. BLOG

    Was Infrastructure Solid During COVID-19? 

    Oct 27, 2020 Will Robson , Niel Harmse

    Real Estate Investing , Risk Management

    Learn More

    Infrastructure investments have not been spared the effects of the pandemic. A closer look across investment types, subsectors and risk levels over time may provide useful perspective as private-capital firms and their investors manage through.

  325. BLOG

    Aligning with the Paris Agreement: An Index Approach 

    Oct 22, 2020 Stuart Doole , Véronique Menou , Kumar Neeraj

    ESG Research , Global Investing

    Learn More

    Institutional investors are under pressure to align their strategies with a maximum global temperature increase of 1.5oC as targeted by the Paris Agreement. We examine how they can approach this while respecting other investment constraints.

  326. BLOG

    Is US Equity Overvalued? A Macro View 

    Oct 19, 2020 Chenlu Zhou

    Equity Themes , Risk Management

    Learn More

    Headed into what some see as “the second wave” of COVID-19, U.S. equity investors may ask: Is this a sustainable market recovery, or a bubble that may burst? We examine the question with our model for market-implied U.S. equity risk premium.

  327. BLOG

    How Portfolio-Weighting Schemes Affected Factor Exposures 

    Oct 15, 2020 Abhishek Gupta , Ashish Lodh , Subhajit Barman

    Factor Investing , Factor Indexes , Factors , Risk Management

    Learn More

    Single-factor portfolios seek high exposure to a target factor and limited exposure to non-target ones. We assess the impact that common portfolio weighting schemes have on these exposures, as well as on portfolio efficiency, concentration and investability.

  328. BLOG

    Using Factors As a Magnifying Glass for Equities 

    Oct 14, 2020 Donald Sze

    Factor Indexes , Factor Investing , Factors

    Learn More

    Factors have been shown to be important systematic sources of risk and return. We examine how factor analysis can help identify investment characteristics that lie beneath the surface of seemingly similar stocks and equity portfolios.

  329. BLOG

    Could COVID-19 Topple Global Cities' Dominance? 

    Oct 13, 2020 Niel Harmse

    Real Estate Investing

    Learn More

    Property investors turned to global gateway cities to diversify portfolios and generate capital growth in the years since the 2008 global financial crisis. We assess whether COVID-19 could jeopardize the relative dominance of these power cities.

  330. BLOG

    Factors in Focus: Impact of Inflation on Style Factors 

    Oct 2, 2020 Hitendra D Varsani , Waman Virgaonkar

    Factor Investing , Global Investing , Risk Management

    Learn More

    Global equities continued to rally in Q3, brushing aside fear of a second wave of COVID-19 and a large economic slump. We review what it meant from an equity and fixed-income factor perspective and look at what our models showed headed into Q4

  331. BLOG

    Banks, ESG and Nonperforming Loans During Covid-19 

    Oct 1, 2020 Jakub Malich

    ESG Research

    Learn More

    Have banks with stronger ESG risk management practices been more financially resilient during the COVID-19 pandemic? We look at the asset quality, profitability and capitalization of banks around the world.

  332. We look at the unusual bankruptcy of Hertz Global Holdings Inc. — whose equity rallied in early June, when holders of Hertz bonds were expecting losses as high as 90% in default — to discuss the importance and subtleties of firms’ capital structures.

  333. BLOG

    Can MBS Duration Turn Negative? 

    Sep 29, 2020 Yihai Yu

    Fixed Income , Risk Management

    Learn More

    As mortgage rates have hit record-breaking lows, prepayment speeds have doubled. With the combination of a high price premium and elevated prepayment speed, could duration of mortgage-backed securities stray into negative territory?

  334. BLOG

    Stress Testing Inflation Scenarios 

    Sep 24, 2020 Thomas Verbraken , Daniel Szabo

    Fixed Income , Risk Management

    Learn More

    Market-implied expectations indicate modest inflation. But some observers are concerned inflation may significantly rise, while others fear deflation. We discuss four inflation scenarios — and their potential implications for stocks and bonds.

  335. BLOG

    Corporate ESG Disclosure: A Health & Safety Case Study 

    Sep 24, 2020 Gaurav Trivedi , Samantha Sue Ping , Ping Sue

    ESG Research

    Learn More

    How good a job are corporations doing in disclosing ESG policies and data to investors and other stakeholders? We took an in-depth look at reporting of health & safety disclosures. Our findings confirmed some common assumptions and upended others.

  336. BLOG

    Scope 3 Carbon Emissions: Seeing the Full Picture 

    Sep 17, 2020 Brendan Baker

    ESG Research

    Learn More

    How can investors identify emissions throughout the value chain of companies in their portfolios? We explain what these “Scope 3” emissions are, why they are so important and what actions investors can take as they seek to manage resulting risks.

  337. BLOG

    Bond Liquidity: How Bad Was COVID? 

    Sep 16, 2020 László Arany

    Risk Management

    Learn More

    Was bond liquidity worse during the COVID-19 outbreak or the 2008 global financial crisis? We analyzed transaction costs from the forced selling of USD 10 million of U.S. corporate bonds, throughout the two crises.

  338. BLOG

    Assessing Company Alignment with UN SDGs 

    Sep 14, 2020 Olga Emelianova

    ESG Research , Global Investing

    Learn More

    Five years ago, the United Nations adopted 17 UN Sustainable Development Goals (SDGs) in an effort to end extreme poverty, reduce inequity and protect the planet by 2030. Using a new tool, we examine whether companies are walking the walk.

  339. BLOG

    Missed Rents’ Impact on Real Estate 

    Sep 11, 2020 Bryan Reid , Niel Harmse

    Real Estate Investing , Fixed Income

    Learn More

    Some commercial tenants have stopped paying rent amid COVID-19. Without rental income, property funds are not able to pay distributions to shareholders and borrowers cannot service their debt. We analyzed property-fund data to assess the impact on investors.

  340. How to define a factor? It’s a challenge for asset owners and wealth managers in evaluating how well factor products meet investment objectives. We found an improved and more robust measure can be formed by combining multiple descriptors. 

  341. BLOG

    Identifying Emerging “Hot Spots” for Physical Risk in the US 

    Sep 9, 2020 Patric Kellermann , Boris Prahl

    ESG Research

    Learn More

    Climate change is expected to increase the frequency and severity of physical climate risks such as extreme temperatures, tropical cyclones, torrential rainfall and flooding. Our map identifies emerging climate risk hotspots in the U.S. 

  342. BLOG

    Are Securitized Products Ready for the LIBOR-SOFR Transition? 

    Sep 2, 2020 Joy Zhang , Yihai Yu

    Fixed Income , Integrated Risk Management

    Learn More

    Will the securitization industry be ready for the transition from LIBOR to the secured overnight financing rate (SOFR), as it faces the fact that LIBOR can no longer be guaranteed beyond the end of 2021? As the industry mobilizes, significant challenges remain.

  343. BLOG

    ESG in Mexico: At a Fork in the Road? 

    Aug 27, 2020 Mario López-Alcalá

    ESG Research , Emerging Markets , Global Investing

    Learn More

    Mexican companies’ ESG risk-mitigation practices have come a long way over the past decade, but there has been some slippage over the past two years. We examine the current status and why investors may want to pay attention.

  344. BLOG

    Alternative Views of Equity-Market Liquidity During COVID-19 

    Aug 26, 2020 Saurabh Katiyar , Reil Abucay , Chirag Gosar

    Emerging Markets , Global Investing , Risk Management

    Learn More

    Institutional investors have typically used traded volume as a way to assess market liquidity. Adding alternative measures that gauge market impact and trading costs can provide a more comprehensive view for portfolio managers and traders.

  345. Aggressive actions by central banks and soaring government budget deficits have raised concerns among some investors that inflation may significantly rise. We examine whether an inflation hedge was worth the cost over the past 13 years.

  346. BLOG

    Is There a Green-to-Fossil-Fuel Premium? 

    Aug 25, 2020 Guillermo Cano , Gaurav Trivedi

    ESG Research

    Learn More

    As investors evaluate the possible reallocation of capital around the transition toward a low-carbon future, we analyzed the characteristics and performance of companies engaged in green versus carbon-intensive activities. Was there evidence of a “green-to-fossil-fuel premium”?

  347. BLOG


    Aug 25, 2020 Guillermo Cano , Gaurav Trivedi

    ESG Research

    Learn More

    从 2013 年 12 月到 2020 年 5 月,“绿色”公司的表现大致与 MSCI全球市场可投资市场指数(IMI)持平,而化石燃料公司的表现则逊于该指数。

  348. BLOG

    Understanding the Industry-Momentum Factor 

    Aug 19, 2020 Alex Johnson , Simon Minovitsky

    Factor Investing , Risk Management , Global Investing

    Learn More

    When COVID-19 first swept through global equity markets, many factors exhibited unprecedented performance swings. How could institutional investors interpret the industry-momentum factor’s moves in the context of the underlying market dynamics?

  349. BLOG

    Growth Without the Side Effects 

    Aug 17, 2020 Mehdi Alighanbari

    Factor Indexes , Factor Investing , Factors

    Learn More

    Growth has sometimes been viewed as the opposite of value. By extending the concept of growth at a reasonable price, we were able to capture the growth premium without it being lost to unintended factor exposures.

  350. BLOG

    The Risk of Risk Limits 

    Aug 5, 2020 Reka Janosik , Thomas Verbraken

    Risk Management

    Learn More

    In times of heightened volatility, risk limits can protect against equity-market drawdowns. While such measures can dampen portfolio losses, they may also have an impact on long-term returns, particularly in case of a sharp V-shaped market recovery.

  351. BLOG

    Index Futures and the Expansion of Equity Markets in EM and Asia 

    Aug 4, 2020 Zhen Wei

    Global Investing , Emerging Markets

    Learn More

    Given equity market growth in the emerging markets and Asia, and the dispersion of returns across individual subregions and countries, some have looked beyond traditional long-only approaches, to others, such as futures. We explore those options.

  352. BLOG

    Did Bonds Deliver? Leveraging Fixed Income During the COVID Crisis 

    Jul 29, 2020 Juan Sampieri , Andy Sparks

    Fixed Income , Risk Management

    Learn More

    Investors may employ leverage with lower-risk asset classes such as bonds to seek higher risk and returns. We assessed the effects of leverage on the returns of three hypothetical multi-asset-class portfolios during the COVID-19 crisis.

  353. BLOG

    Corporate Bonds Through a Factor and ESG Lens 

    Jul 20, 2020 Rohit Mendiratta , Hitendra D Varsani

    ESG Research , Factor Indexes , Factor Investing , Factors , Fixed Income , Risk Management

    Learn More

    COVID-19 has had a profound impact on how companies manage cash flows and liquidity. Bond investors face the possibility of increased leverage, rating downgrades and defaults. Can factors and ESG metrics shed light on these risks?

  354. BLOG

    Managing Climate Risk in Equity Portfolios: A Case Study 

    Jul 15, 2020 Bruno Rauis , Zoltán Nagy

    ESG Research , Global Investing

    Learn More

    Institutional investors are increasingly focused on mitigating their climate-related risks. How could a “typical” active global equity manager have managed these exposures without disturbing the portfolio’s risk and return characteristics?

  355. BLOG

    Measuring Firms’ Remote-Workforce Abilities 

    Jul 14, 2020 Howard Zhang , Daniel R. Barrera , Manuel Rueda

    Factor Investing , Factors

    Learn More

    It’s clear that some companies were better positioned to take advantage of a remote work environment than others. We built a hypothetical “remote-operation capacity” factor to seek to measure the effect on different firms.

  356. BLOG

    Up in Smoke? Brazil’s Wildfires May Affect Bond Spreads 

    Jul 10, 2020 Mario López-Alcalá , Hamed Faquiryan

    ESG Research , Fixed Income , Risk Management

    Learn More

    Clearing Brazilian forests to make way for agriculture may spur a backlash to soy and beef producers if purchasers impose deforestation-free rules. What are the potential implications for debt of affected companies and for Brazilian sovereign debt?

  357. BLOG

    Measuring Climate Risk in Real Estate Portfolios 

    Jul 8, 2020 Bryan Reid

    ESG Research , Real Estate Investing

    Learn More

    By evaluating real estate portfolios in terms of different physical risks as well as under different transition-risk scenarios, investors may be able to build a more complete picture of their exposure.

  358. BLOG

    Would Integrating ESG in Chinese Equities Have Worked? 

    Jul 7, 2020 Naoya Nishimura , Shuo Xu

    ESG Research , Emerging Markets , Global Investing

    Learn More

    ESG ratings have reflected financial risk and returns in developed-market and emerging-market equities. But was this true in China, where ESG considerations are still in their infancy?

  359. BLOG

    将 ESG 融入到中国股票的成效如何? 

    Jul 7, 2020 Naoya Nishimura , Shuo Xu

    ESG Research , Emerging Markets , Global Investing

    Learn More

    过去两年,中国企业的 ESG 评级大幅提升。通过回测,剔除一些 ESG 评级低的股票,能够有助于一批聚焦中国的主动型基金在过去五年半时间内降低风险和提高投资回报。

  360. BLOG

    Factors in Focus: How Trendy Is Your Style Factor? 

    Jul 6, 2020 Hitendra D Varsani , Waman Virgaonkar , Rohit Mendiratta

    Factor Investing , Risk Management

    Learn More

    As markets rallied worldwide, investors took on high-beta exposure and rotated away from stocks with lower risk. The latest edition of Factors in Focus explores the details.

  361. BLOG

    Surging Corporate-Bond Supply: Reason to Worry? 

    Jul 1, 2020 Andy Sparks , Gergely Szalka

    Fixed Income , Risk Management

    Learn More

    In the months since the onset of the COVID-19 pandemic, companies issued a large amount of corporate bonds. As a result of this surge, corporate debt has grown substantially — a burden that institutional credit investors may wish to monitor closely.

  362. BLOG

    Did Value-Factor Exposure Deliver for Value Funds? 

    Jun 29, 2020 Saurabh Katiyar , Ashish Lodh , Vishad Bhalodia

    Factor Investing , Global Investing

    Learn More

    Building on previous MSCI research into the nuanced performance of the value factor, including the impact of sectors and other style factors, we look at how exposure to value drove the performance of actively managed value funds.

  363. BLOG

    ESG Ratings: How the Weighting Scheme Affected Performance 

    Jun 29, 2020 Zoltán Nagy , Linda-Eling Lee , Guido Giese

    Global Investing , ESG Research

    Learn More

    Our recent research suggests that environmental and social issues were more industry specific and tended to show up in financial measures over a longer time frame compared to governance issues. How can E, S and G issues be combined?

  364. BLOG

    Short Interest Factor Performance in Times of Crisis 

    Jun 24, 2020 Vipul Jain , Roman Kouzmenko

    Factors , Factor Investing

    Learn More

    Given recent short interest factor performance, we asked: What has been the relationship between this factor and large market drawdowns? Were there changes in short selling during COVID-19? Did short-selling bans affect short interest factor performance?

  365. BLOG

    COVID-19 and Real Estate: The Devil Is in the Dispersion 

    Jun 23, 2020 Fritz Louw , Niel Harmse

    Real Estate Investing , Risk Management

    Learn More

    Many real estate markets were showing signs of a slowdown even before COVID-19’s negative impact on property portfolios. Has this correction been similar to previous ones? We looked at dispersion of returns, within and across real estate sectors, for the answer.

  366. BLOG

    Which ESG Issues Mattered Most? Defining Event and Erosion Risks 

    Jun 22, 2020 Guido Giese , Zoltán Nagy , Linda-Eling Lee

    Global Investing , ESG Research

    Learn More

    Very different ESG issues can be material for different industries. Our research suggests that risks can be divided into two main types: “event” risks and “erosion” risks to companies’ long-term competitiveness. Which ones mattered most for E, S and G?

  367. BLOG

    Is ESG All About the ‘G’? That Depends on Your Time Horizon. 

    Jun 15, 2020 Linda-Eling Lee , Guido Giese , Zoltán Nagy

    Global Investing , ESG Research

    Learn More

    The conventional wisdom has it that governance is the most dominant of the three E, S and G pillars. But our analysis finds different results when looking at contribution to performance over different time horizons.

  368. BLOG

    Consumer ABS: Recovering from Coronavirus? 

    Jun 11, 2020 Yini Yang , Jian Chen , Joy Zhang

    Risk Management , Fixed Income

    Learn More

    After the U.S. COVID-19 lockdown, new monthly remittance reports for asset-backed securities indicated performance deterioration and signaled potential challenges ahead. Meanwhile, in China, ABS showed signs of recovery.

  369. BLOG


    Jun 11, 2020

    ESG Research

    Learn More


  370. BLOG

    Equity-Market Dislocation and Index-Based Investing 

    Jun 3, 2020 Shuo Xu , Zhen Wei

    Emerging Markets , Global Investing

    Learn More

    Market turbulence amid COVID-19 presented risks and opportunities. We explore how indexes , combined with the use of fundamental data, provided a wealth of information to help identify potential market dislocations.

  371. BLOG

    Outcome-Oriented Factor Investing with a ‘Barbell’ Approach 

    Jun 1, 2020 Zhen Wei , Shuo Xu

    Factor Indexes , Factor Investing , Global Investing

    Learn More

    Though relatively new to wealth investors, index-based factor investing has some similarity to a high-conviction, outcome-oriented approach. We explore combining the two when seeking outcomes such as equity growth, yield enhancement and risk mitigation.

  372. BLOG

    Can AI Model the Complexities of MBS Prepayment? 

    May 29, 2020 Joy Zhang , Yini Yang

    Fixed Income , Risk Management

    Learn More

    Machine learning using neural networks has been successfully applied to fields in which extremely complex patterns can prove challenging for other algorithms. Are neural networks suited for modeling prepayment risk in agency mortgage-backed securities?

  373. BLOG

    Building Better ESG Indexes: 30 Years On 

    May 27, 2020 Stuart Doole

    Global Investing , ESG Research

    Learn More

    How ESG indexes have evolved over the past 30 years: A Q&A with Stuart Doole, head of new index development at MSCI, about his conversations with investors since the COVID19 crisis started, the growth of ESG investing and how MSCI Research uses AI and machine learning in developing its ESG indexes.

  374. BLOG

    Robust Selection Paid Dividends 

    May 22, 2020 Neeraj Dabake , Ankit Shah

    Global Investing

    Learn More

    Dividend cuts following the COVID-19 slowdown led to approximately USD 194 billion of lost dividends between February and April 2020. An approach that looked beyond dividend-yield ranking would have avoided some affected companies, based on our analysis.

  375. BLOG

    Four COVID-19 Scenarios: What Might Happen Next? 

    May 21, 2020 Thomas Verbraken , Juan Sampieri

    Fixed Income , Risk Management

    Learn More

    Our latest COVID-19 stress test looks at four potential financial-market outcomes ranging from a swift V-shaped recovery to a pessimistic L-shaped scenario, in which outbreaks recur and lockdowns return well into 2021.

  376. BLOG

    Five lessons for investors from the COVID-19 crisis 

    May 19, 2020 Dimitris Melas

    ESG Research , Factors , Global Investing

    Learn More

    COVID-19 unleashed a torrent of sharp movements across global financial markets. We highlight five key lessons for investors regarding global investing, managing factors, active management, indexed investing and ESG investing.

  377. BLOG

    Using Risk Analytics to Highlight Opportunities in Volatile Markets 

    May 18, 2020 Michael Hayes

    Risk Management , Fixed Income

    Learn More

    Risk analytics can serve many functions for an institutional investor, including compliance, risk management, portfolio management and trading and strategy development. They may also highlight new opportunities that may be unique to volatile markets.

  378. BLOG

    Real Estate Asset Selection Mattered — Especially in a Crisis 

    May 14, 2020 Bryan Reid

    Real Estate Investing

    Learn More

    As real estate strategies become more complex and market disruption continues, attribution analysis may prove a valuable tool. We looked at asset selection’s role in driving portfolios’ relative returns during relatively calm and disruptive periods.

  379. BLOG

    Index Rebalancing During High Volatility: A Balancing Act 

    May 13, 2020 Abhishek Gupta , Pavlo Taranenko , Sebastien Lieblich

    Global Investing , Emerging Markets

    Learn More

    Significant volatility during COVID-19 highlights a need for index reconstitution, but some may worry about trading costs and excess turnover. We investigate the balance between appropriate market representation and avoiding high index turnover.

  380. BLOG

    Consumer ABS Under Coronavirus in the US and China 

    May 11, 2020 Yini Yang , Jian Chen , Joy Zhang

    Emerging Markets , Fixed Income , Global Investing , Risk Management

    Learn More

    Beyond COVID-19’s steep human toll, the pandemic’s disruption of economic life has led to widespread loss of income and impaired some borrowers’ ability to repay loans. What could the impact be for investors in consumer asset-backed securities in the U.S. and China?

  381. BLOG

    How Hedge Funds Navigated the Start of COVID-19 Volatility 

    May 8, 2020 Donald Sze , Navneet Kumar

    Factor Investing , Factors , Risk Management

    Learn More

    How did hedge funds navigate the initial volatility amid COVID-19? Though holdings information is limited, and delayed, we gained insights into their reaction by examining the change in hedge-fund portfolios between the end of January and end of February.

  382. BLOG

    Credit in the COVID Crisis: Contagion, Valuation, Default 

    May 6, 2020 Hamed Faquiryan , Reka Janosik , Andras Rokob

    Fixed Income , Risk Management

    Learn More

    As the COVID-19 crisis unfolded, credit markets deteriorated under the stress of a sharply diminished economic outlook. We analyze three indicators of credit-market conditions: default risk, relative value and contagion risk.

  383. BLOG

    Was the Treasury Price Right? Yield Dispersion Amid COVID-19 

    May 5, 2020 Alfredo Bequillard , Greg Recine

    Fixed Income , Risk Management

    Learn More

    Despite appearances, Treasury yield curves are statistically estimated using price data from hundreds of Treasurys. We compared recent yield dispersion — or the degree to which individual bond yields fall away from the curve — to historical levels.

  384. BLOG

    Using Derivatives to Manage Volatile Markets 

    May 4, 2020 Hitendra D Varsani , Rohit Mendiratta

    Emerging Markets , Global Investing , Risk Management

    Learn More

    We’ve previously noted growth in derivatives contracts to manage emerging-markets exposure in normal and stressed times. Now, facing a real-world stress test, how did investors use these tools? How have implied volatilities and option premium changed?

  385. BLOG

    Hunting a COVID-19 factor 

    Apr 29, 2020 George Bonne , Jun Wang

    Factor Indexes , Factor Investing , Factors

    Learn More

    Can we identify a COVID-19 factor and quantify companies’ exposure to it? We explored three ways to do so — from very simple to more complex methods.

  386. BLOG

    Did hedging tail risk pay off? 

    Apr 27, 2020 Peter Shepard , John Burke

    Risk Management

    Learn More

    Investors taking stock of the coronavirus fallout and recent market volatility have begun exploring tail-risk-hedging strategies as a way to protect against further drawdowns. What are the potential costs and benefits of hedging against tail risk?

  387. BLOG

    新冠疫情期间的 MSCI ESG 指数 

    Apr 22, 2020 Zoltán Nagy , Guido Giese

    ESG Research , Emerging Markets , Global Investing

    Learn More

    在新冠疫情的恐慌抛售期间以及更长时期内,我们将四个全球 MSCI ESG 指数与其母指数进行了比较。

  388. BLOG

    MSCI ESG Indexes during the coronavirus crisis 

    Apr 22, 2020 Zoltán Nagy , Guido Giese

    ESG Research , Emerging Markets , Global Investing

    Learn More

    The COVID-19 outbreak is the first real-world test since the 2008 global financial crisis of the resilience of companies with high MSCI ESG Ratings. We analyze the performance of four standard MSCI ESG Indexes over Q1 2020 and longer periods.

  389. BLOG

    US inflation: The market’s implied view 

    Apr 21, 2020 Greg Scheuer , Andy Sparks

    Fixed Income , Risk Management

    Learn More

    Dramatic declines in oil prices, the Federal Reserve’s aggressive monetary policy and higher fiscal deficits may create a confusing outlook for U.S. inflation. We examine what the market is telling us about where inflation may be heading.

  390. BLOG

    How COVID-19 could impact private real estate values 

    Apr 20, 2020 Bryan Reid , Yang Liu

    Real Estate Investing

    Learn More

    Real estate has not historically been immune to growth shocks, but the impact of COVID-19 has been harder to establish than it has for public equities. Discounted-cash-flow scenarios may help investors understand the potential sensitivity of their portfolios.

  391. BLOG

    Resilient stocks during the dog days of March 

    Apr 17, 2020 Mehdi Alighanbari

    Factor Investing , Factor Indexes , Factors

    Learn More

    While many stocks were in the red in mid-March, as COVID-19 and oil-market shocks took hold, some were “redder” than others. We examine global markets to better understand the characteristics of the more resilient stocks during this period.

  392. BLOG

    Can diversification help weather the coronavirus storm? 

    Apr 16, 2020 Raina Oberoi , Abhishek Gupta , Jean-Maurice Ladure

    Emerging Markets , Factor Indexes , Factor Investing , Factors , Global Investing

    Learn More

    Whether investors include a tactical approach or invest strategically for the long term, diversifying across factors, sectors and geographies has historically played an important role in portfolio construction. 

  393. BLOG

    Could coronavirus depress US housing prices? 

    Apr 15, 2020 Yihai Yu , Joy Zhang

    Risk Management , Fixed Income

    Learn More

    The large economic shocks unleashed by the coronavirus pandemic could be comparable to or even exceed those of the 2008 global financial crisis (GFC). We used our models to assess whether these shocks could hurt U.S. housing prices as much as the GFC did.

  394. BLOG

    Green bonds: Growing bigger and broader 

    Apr 14, 2020 Meghna Mehta

    ESG Research , Fixed Income , Global Investing

    Learn More

    As the green-bond market matures, it is developing offshoots. The types of projects financed, as well as the emergence of innovative types of bonds and loans linked to the ESG targets, is growing. These initiatives may broaden the market for green investment options.

  395. BLOG

    Corporate-bond performance by factors and ESG 

    Apr 14, 2020 Rohit Mendiratta , Hitendra D Varsani

    ESG Research , Factor Indexes , Fixed Income , Risk Management

    Learn More

    The volatility seen in equity markets was also present among investment-grade corporate bonds,. We use factors and ESG ratings to dissect these bonds’ performance over Q1 2020.

  396. BLOG

    For target-date funds, hindsight was 40/60 

    Apr 9, 2020 Anil Rao

    ESG Research , Factor Indexes , Fixed Income , Risk Management

    Learn More

    Recent market volatility has been especially unkind to those closest to and early in retirement, as the sequence of returns matters for retirement income. Would low-volatility and ESG investments have benefited target date funds during volatile periods?

  397. BLOG

    Bond ETFs and underlying price uncertainty 

    Apr 8, 2020 András Bohák , Reka Janosik

    Risk Management , Fixed Income

    Learn More

    In the recent market meltdown, some fixed-income ETFs traded at discounts as high as 6% to net asset values, a level not seen since 2008. Could ETF prices deviate from the value of the underlying portfolio during market stress and leave investors exposed to losses on top of the falling bond prices?

  398. BLOG

    Quantifying ESG fund performance 

    Apr 6, 2020 Raina Oberoi , Guillermo Cano

    ESG Research , Factors

    Learn More

    One challenge facing investors is how to quantify the impact ESG has had on their investment process. We analyzed top ESG funds to better understand the contribution of the ESG factor to their performance.

  399. BLOG

    What out-of-cycle write-downs may mean for real estate yields 

    Apr 3, 2020 Bryan Reid

    Real Estate Investing

    Learn More

    As real estate investors seek to understand how the COVID-19 crisis could affect their portfolios, several large Australian pension funds recently wrote down their property portfolios by up to 10%. What could a 10% write-down imply for yields?

  400. BLOG

    Will coronavirus reduce emissions long term? 

    Apr 3, 2020 Oliver Marchand , Nathan Faigle

    ESG Research , Global Investing

    Learn More

    Has COVID-19 affected carbon emissions? Using satellite imagery from NASA and the European Space Agency, we examined the empirical data so far to understand the potential impact, and if there may be a decline in global greenhouse-gas emissions in 2020.

  401. BLOG

    Factors in Focus: Risk sentiment and factor dynamics in a crisis 

    Apr 2, 2020 Waman Virgaonkar , Rohit Mendiratta , Hitendra D Varsani

    Factor Indexes , Factor Investing , Factors , Fixed Income

    Learn More

    We analyzed the market effects from COVID-19 and a Saudi Arabia/Russia oil-price war. We also examined – for the first time – credit factor performance. How did the quarter play out? What did our adaptive multi-factor model show as it ended?

  402. BLOG

    Could coronavirus lead to default contagion in CLOs? 

    Apr 1, 2020 Joy Zhang , Yini Yang

    Risk Management , Fixed Income

    Learn More

    The market for collateralized loan obligations is under severe stress during the COVID-19 pandemic. We used MSCI’s loan and CLO models to assess a sample CLO’s loan-default risk characteristics. Could a wave of defaults harm CLOs?

  403. BLOG

    The end of an era for the bond-equity relationship? 

    Mar 31, 2020 Peter Shepard , Chenlu Zhou

    Risk Management , Fixed Income

    Learn More

    Stock and bond prices dropped together during the recent coronavirus sell-off, leading to fears that U.S. Treasurys were no longer the safe haven they had been in previous crises. Did it mark the end of an era of flight to quality?

  404. BLOG

    Managing risk-model uncertainty through a crisis 

    Mar 27, 2020 Michael Hayes

    Risk Management

    Learn More

    The impact on risk policy has been similar across market crises, as investors consider how to use their models in the new regime. We describe adaptive modeling for internal and external risk policy, and long-view backtesting to support decision-making.

  405. BLOG

    ‘Nowcasting’ private equity in the coronavirus crisis 

    Mar 26, 2020 Yang Liu , Peter Shepard

    Risk Management

    Learn More

    What may be happening to the value of portfolios of private assets during the COVID-19 crisis? We used MSCI’s private-equity model, which integrates data on private assets from our partner Burgiss, to try to shed some light.

  406. BLOG

    How could coronavirus impact credit markets? 

    Mar 25, 2020 Juan Sampieri , Andy Sparks , Thomas Verbraken

    Risk Management , Fixed Income

    Learn More

    While newspaper headlines are focused on volatile stock markets stemming from the COVID-19 pandemic, credit markets are not immune. Our latest stress test asks, “What would it mean for portfolios if losses reached 2008 levels?”

  407. BLOG


    Mar 25, 2020 Shuo Xu , Wei Xu , Zhen Wei

    Emerging Markets , Global Investing , Risk Management

    Learn More


  408. BLOG

    Asset allocation and index futures during market crises 

    Mar 25, 2020 Shuo Xu , Wei Xu , Zhen Wei

    Emerging Markets , Global Investing , Risk Management

    Learn More

    During market crises, institutional investors have employed derivatives contracts to hedge market risks or express views on certain performance/risk characteristics. We explore prior use of futures for exposure management and tactical asset allocation.

  409. BLOG

    Updating the MSCI Agency MBS model for the COVID-19 crisis 

    Mar 24, 2020 Yihai Yu

    Fixed Income , Risk Management

    Learn More

    The COVID-19 pandemic has severely strained U.S. housing finance, distorting near-term prepayment speeds for mortgage-backed securities. With MBS in uncharted territory, we updated the MSCI Agency MBS Model to help investors during the crisis.

  410. BLOG

    How coronavirus could hurt Chinese consumer ABS 

    Mar 20, 2020 Yini Yang , Jian Chen

    Risk Management , Global Investing , Fixed Income , Emerging Markets

    Learn More

    The slowing Chinese economy and trade uncertainty had already put strains on the performance of Chinese consumer asset-backed securities. The COVID-19 pandemic could further harm the performance of these securities. Investors may wish to gauge the risks.

  411. BLOG

    Real estate is about more than location during uncertain times 

    Mar 18, 2020 Niel Harmse

    Real Estate Investing

    Learn More

    With real estate now occupying a greater slice of multi-asset-class portfolios, factors such as lease length, may be more systematic drivers of return than previously thought. 

  412. BLOG

    Integrating ESG in emerging markets and Asia 

    Mar 18, 2020 Zhen Wei

    ESG Research , Emerging Markets , Global Investing

    Learn More

    Previously, we have examined the relationship between ESG characteristics and financial performance in developed markets. In this blog post, we explore whether ESG characteristics  have had financially significant effects in emerging markets and Asia.

  413. BLOG


    Mar 18, 2020 Zhen Wei

    ESG Research , Emerging Markets , Global Investing

    Learn More

    在我们研究的时间区间内,ESG 评级较高的股票在新兴市场和亚洲(日本除外)地区表现较好,整合ESG 提高了这些地区的回报。

  414. BLOG

    What scenarios has the US equity market priced in? 

    Mar 13, 2020 Peter Shepard , Andrea Amato , Chenlu Zhou

    Risk Management

    Learn More

    With the outbreak of the COVID-19 pandemic, the U.S. equity market turned sharply downward. We performed a reverse stress test considering various scenarios that potentially explain current valuations.

  415. BLOG

    Coronavirus and oil hit equities — how low can we go? 

    Mar 12, 2020 Dimitris Melas

    Risk Management , Global Investing

    Learn More

    We compare the market turmoil sparked by the coronavirus pandemic with levels of volatility, drawdown and recovery after 9/11 and the global financial crisis (the two other similarly severe economic and market shocks of the last 20 years).

  416. BLOG

    Have corporate green bonds offered lower yields? 

    Mar 10, 2020 Zach Tokura

    ESG Research , Risk Management , Fixed Income

    Learn More

    Green bonds tended to offer lower yields than comparable non-green corporate bonds. What could explain green bonds’ lower yields? And is there any relationship between green-bond issuers’ environmental scores and bond yields?

  417. BLOG

    Coronavirus and a potential MBS convexity whipsaw 

    Mar 6, 2020 Yihai Yu

    Risk Management

    Learn More

    Amid rising fears that the human toll of coronavirus will have a significant impact on the global economy, investors have sought safety in Treasurys and driven yields to all-time lows. This rate rally has posed a hedging challenge for investors in mortgage-backed securities.

  418. BLOG

    The coronavirus market impact spreads globally 

    Mar 5, 2020 Jun Wang , Jay Yao , George Bonne

    Factor Investing , Global Investing

    Learn More

    Fear of a coronavirus pandemic and ensuing economic impacts caused sharp drops in global markets after an initially mild response. We look at recent performance from a factor perspective and how quickly factor returns and volatility reverted in past crises.

  419. BLOG

    A coronavirus stress test for global markets 

    Mar 4, 2020 Juan Sampieri , Thomas Verbraken , Chenlu Zhou

    Fixed Income , Global Investing , Risk Management

    Learn More

    After the coronavirus spread to multiple continents, markets recorded the worst week since the crisis. How much further could markets drop if epidemic turns into pandemic? Our stress test indicates room for further losses.

  420. BLOG

    SEC’s proxy proposal: Who would benefit? 

    Mar 3, 2020 Ric Marshall

    ESG Research

    Learn More

    The SEC has proposed reforms to the proxy process that would curb the number of proposals submitted by small shareholders. But such a change may disadvantage all shareholders, who have provided significant levels of support for these initiatives.

  421. BLOG

    Navigating market volatility with agency MBS models 

    Feb 26, 2020 David Zhang

    Fixed Income , Risk Management

    Learn More

    We performed our annual review of MSCI’s model for managing prepayment and interest-rate risk in agency mortgage-backed securities. How closely did the model’s forecasts anticipate what we observed in the market?

  422. BLOG

    ESG and the cost of capital 

    Feb 25, 2020 Ashish Lodh

    ESG Research , Global Investing , Emerging Markets

    Learn More

    We know a lot about the relationship between companies’ ESG characteristics and financial performance. But was there a correlation between ESG scores and cost of capital?

  423. BLOG

    The coronavirus epidemic: Implications for markets 

    Feb 12, 2020 Jun Wang , Zhen Wei , Thomas Verbraken

    Economic Exposure , Emerging Markets , Factor Investing , Fixed Income , Global Investing , Risk Management

    Learn More

    The toll from the coronavirus has been felt throughout societies, leading to repercussions on the global economy and financial markets. We examine investor impact through markets’ economic exposures to China and factors and by stress testing portfolios.

  424. BLOG

    What’s driven capital growth in real estate portfolios? 

    Feb 6, 2020 Bryan Reid

    Real Estate Investing

    Learn More

    In real estate investing, capital growth has historically been responsible for most of the observed volatility in total returns. Could breaking capital growth into its components help tell a more detailed story of property portfolios’ performance?

  425. BLOG

    How climate change may ‘flood’ global equities 

    Feb 5, 2020 Boris Prahl , David Lunsford

    ESG Research , Emerging Markets

    Learn More

    Of all the threats to the environment from climate change, sea-level rise may be one of the most devastating and permanent. The question for global equity investors is how coastal-flooding risks may affect their portfolios.

  426. BLOG

    Aramco IPO shows importance of timely index inclusion 

    Feb 4, 2020 Saurabh Katiyar

    Emerging Markets , Global Investing

    Learn More

    Saudi Aramco’s IPO showed why single-country index providers may sometimes need to include companies (especially larger ones) outside of scheduled reviews, as they work to bridge gaps between a country’s equity index exposure and economic drivers.

  427. BLOG


    Feb 1, 2020

    ESG Research

    Learn More


  428. BLOG


    Feb 1, 2020

    ESG Research

    Learn More


  429. BLOG

    Did private capital deliver? 

    Jan 30, 2020 Yang Liu , Oleg Ruban

    Global Investing

    Learn More

    Private-capital funds enjoyed record inflows from 2014 to 2018, as asset owners sought high-returning assets that had low correlations to traditional public asset classes. Did private capital deliver?

  430. BLOG

    Trade deal broadened access to China’s nonperforming loans 

    Jan 29, 2020 Yini Yang , Jian Chen

    Risk Management , Fixed Income , Global Investing , Emerging Markets

    Learn More

    The phase-one U.S.-China trade deal lets U.S. asset managers acquire nonperforming loans directly from Chinese banks. We assess the market’s characteristics, as investors face challenges estimating recovery rates and liquidation timing of these loans.

  431. BLOG

    Did corporate-credit factors offer a risk-return edge? 

    Jan 24, 2020 Rohit Mendiratta , Hitendra D Varsani

    Factor Indexes , Factor Investing , Factors , Fixed Income , Risk Management

    Learn More

    Factors have gained popularity in equity investing for providing insight into the key drivers of portfolio risk and returns. Did tilting hypothetical fixed-income portfolios toward some bond-specific factors benefit investors?

  432. BLOG

    Counterparty credit risk and the initial-margin big bang 

    Jan 22, 2020 Benedek Skublics

    Risk Management

    Learn More

    A forthcoming global regulatory standard will require derivatives users to estimate mandatory initial margin on their portfolios. The choice of model methodology may have a significant impact on this calculation.

  433. BLOG

    MBS prepayment in 2020: Looking back, looking ahead 

    Jan 21, 2020 Yihai Yu

    Fixed Income , Risk Management

    Learn More

    Drawing on two decades of U.S. data on MBS prepayment and borrower incentives to refinance, we used our model to look at three potential prepayment themes for 2020.

  434. BLOG

    2020 Emerging Real Estate Trends 

    Jan 16, 2020 Will Robson

    Real Estate Investing

    Learn More

    From managing climate risk to advances in analytics, 2020 may be a watershed year for real estate. Read our top five emerging trends likely to be front of mind for global real estate investors in 2020 and beyond

  435. ESG themes are long-term, but some can emerge with sudden force. We are watching five trends we believe will unfold in 2020 to catapult ESG investing into the new decade.

  436. BLOG

    Factors in Focus: Will 2020 vision sharpen exposures? 

    Jan 6, 2020 Waman Virgaonkar , Hitendra D Varsani

    Factor Indexes , Factor Investing , Factors

    Learn More

    Some global equity markets reached all-time highs and experienced limited bouts of volatility over the course of 2019. But underneath the calm surface, we saw a high degree of dispersion among factors and sectors.

  437. BLOG

    Synthetic CDOs: Back in vogue but not without risk 

    Dec 13, 2019 Gabor Almasi

    Fixed Income , Risk Management

    Learn More

    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.

  438. BLOG

    Looking to the futures of emerging markets 

    Dec 11, 2019 Hitendra D Varsani

    Global Investing , Risk Management , Economic Exposure , Emerging Markets

    Learn More

    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?

  439. BLOG

    Has global sovereign rates momentum headed in reverse? 

    Dec 6, 2019 Andrew DeMond

    Risk Management , Fixed Income

    Learn More

    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.

  440. BLOG

    Emerging markets since China A shares’ inclusion 

    Dec 5, 2019 Wei Zhen

    Global Investing

    Learn More

    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.

  441. BLOG

    The value of standards in the investment process 

    Dec 2, 2019 Guillermo Cano

    Global Investing

    Learn More

    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.

  442. BLOG

    Are EU corporate bonds all alike? 

    Nov 27, 2019 Hamed Faquiryan

    Economic Exposure , Fixed Income , Risk Management

    Learn More

    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.

  443. BLOG

    Digging deeper into pan-European property funds’ performance 

    Nov 26, 2019 Will Robson

    Real Estate Investing

    Learn More

    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.

  444. BLOG

    Factors behind value’s underperformance 

    Nov 22, 2019 Leon Roisenberg

    Factor Indexes , Factor Investing , Factors

    Learn More

    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.

  445. BLOG

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

    Nov 20, 2019 Juan Sampieri , Andy Sparks

    Fixed Income , Risk Management

    Learn More

    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.

  446. BLOG

    Did insider transactions have secrets to tell? 

    Nov 19, 2019 Vipul Jain , Roman Kouzmenko

    Factor Investing , Factors , Risk Management

    Learn More

    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?

  447. BLOG

    A default wave for Chinese consumer ABS? 

    Nov 18, 2019 Yini Yang , Jian Chen

    Economic Exposure , Emerging Markets , Fixed Income , Global Investing , Risk Management

    Learn More

    The default rate for auto loans in Chinese consumer asset-backed securities increased rapidly in recent months, and China may be moving toward a more borrower-friendly bankruptcy regime. Could this   lead to even higher default rates?

  448. BLOG

    Have regional equity-market correlations risen? 

    Nov 15, 2019 Guido Giese , Roman Kouzmenko

    Global Investing

    Learn More

    Global equity investors use regions as building blocks in asset allocation, typically segregating markets by how developed they are and by geography. Has globalization reduced the potential for geographical portfolio diversification?

  449. BLOG

    The state of global investing 

    Nov 12, 2019 Dimitris Melas

    Economic Exposure , Emerging Markets , Global Investing

    Learn More

    Financial markets are inherently unpredictable, while structural forces such as shifts in monetary policy, trade conflicts and climate change compound the challenges facing investors. Read our analysis commissioned by Norway’s Ministry of Finance.

  450. BLOG

    Emerging market country allocation matters 

    Nov 6, 2019 Jean-Maurice Ladure

    Emerging Markets , Global Investing , Economic Exposure

    Learn More

    Investors with strong convictions on emerging markets might consider an approach allowing tilts toward or away from specific themes, such as active allocation to single-country index-based funds. We explore considerations linked with this approach.

  451. BLOG

    Cyclicals vs. defensives: Did tariffs tip the scales? 

    Nov 5, 2019 Guillermo Cano

    Economic Exposure , Emerging Markets , Global Investing

    Learn More

    Did tariffs imposed by the U.S. and China in May trigger a shift to defensive from cyclical stocks? How did they affect different U.S. sectors and industry groups?

  452. BLOG

    CEO Pay: Trick or Treat? 

    Oct 30, 2019 Ric Marshall

    ESG Research

    Learn More

    Some large asset owners are increasingly coming to believe that many executive pay schemes don’t align the interests of CEOs and investors. There appears to be an increasing focus on pay plan simplicity and transparency.

  453. BLOG

    Exploring the ‘what ifs?’ in real estate 

    Oct 29, 2019 Bryan Reid

    Real Estate Investing

    Learn More

    The opacity of real estate markets and the wide spectrum of potential outcomes makes it hard to understand performance. Running a historical “what if” analysis may help institutional investors understand how different choices could have impacted outcomes.

  454. BLOG

    Beware high dividend yield traps 

    Oct 25, 2019 Saurabh Katiyar , Jean-Maurice Ladure , Ashish Lodh

    Factor Investing , Factors , Risk Management

    Learn More

    During low interest-rate, high-volatility environments, some investors have turned to high dividend-paying stocks. However, overly simplistic approaches to selecting dividend-paying securities exposed investors to potential “yield traps.” Could these traps have been avoided?

  455. BLOG

    Repo-market turmoil may not spell SOFR’s end 

    Oct 24, 2019 Michael Hayes , Maks Oks

    Fixed Income , Risk Management

    Learn More

    Investors and the media have begun to worry that the secured overnight financing rate (SOFR) — the U.S. interest-rate benchmark meant to address issues with and replace USD LIBOR — may introduce a new set of problems. Are the concerns justified?

  456. BLOG

    Value investing is down. But is it out? 

    Oct 23, 2019 Abhishek Gupta , Anil Rao

    Factor Indexes , Factor Investing , Factors , Global Investing

    Learn More

    Value stocks generally underperformed the broad U.S. equity market over the past decade — just as they did in the late 1990s. What drove that underperformance? Was it consistent globally? Within U.S. sectors?

  457. Amid ongoing U.S.-China trade tension, we have updated our stress test to consider three scenarios for how the situation could unfold — and their impact on currency, bond and equity markets around the world.

  458. BLOG

    Factors separated fact from fiction 

    Oct 16, 2019 George Bonne

    Factor Indexes , Factor Investing , Factors

    Learn More

    Technological advances have expanded the application of factors. What was the realm of quantitative investors has become more accessible, bringing greater transparency and potential insight into portfolio characteristics and performance drivers.

  459. BLOG

    Chinese convertibles: Equities in fancy dress? 

    Oct 14, 2019 Gergely Szalka

    Emerging Markets , Fixed Income , Global Investing , Models/Client Cases , Risk Management

    Learn More

    Chinese corporate bonds that convert to A shares display equity-like characteristics. But investors who view these securities as equities in disguise are overlooking the complexities of the asset class.

  460. BLOG

    Retire in Monte Carlo? Simulating retirement outcomes 

    Oct 11, 2019 Anil Rao

    ESG Research , Factor Investing , Models/Client Cases , Risk Management

    Learn More

    Despite global equity performance, U.S. DC plan participants may be ill prepared to meet retirement-spending needs. We assessed four equity-allocation scenarios — including an equity multifactor allocation  and integration of ESG views —  to see which performed best.

  461. BLOG

    Stress testing Brexit: Deal or no deal? 

    Oct 9, 2019 Anikó Maráz , Thomas Verbraken , Maraz Aniko

    Global Investing , Models/Client Cases , Risk Management

    Learn More

    Brexit has roiled markets since U.K. voters chose “leave” in the June 2016 referendum. We used our stress-testing model to examine how markets could react to deal and no-deal scenarios.

  462. BLOG

    Is Europe more than the sum of its parts? 

    Oct 8, 2019 Jean-Maurice Ladure

    Equity indexes

    Learn More

    Investors have a choice between investing in European stocks regionally or through local-country index-based portfolios. What are the pros and cons?

  463. BLOG

    What’s the downside in real estate? 

    Oct 4, 2019 Bryan Reid

    Real Estate Investing , Global Investing

    Learn More

    Real estate has always been marked by periods of expansion and sometimes painful corrections. But all cycles are not alike.

  464. BLOG

    Factors in Focus: Momentum hits a valuation speed bump 

    Oct 3, 2019 Waman Virgaonkar , Hitendra D Varsani

    Factor Investing , Factors , Models/Client Cases , Risk Management

    Learn More

    The momentum-value spread saw one of the largest corrections in history over the summer. What does our model show going forward?

  465. BLOG

    Senior bonds in name only 

    Oct 2, 2019 Máté Maródi

    Fixed Income , Models/Client Cases , Risk Management

    Learn More

    Write-down protection doesn’t extend to a new bond category issued by too-big-to-fail European banks: senior non-preferred. Investors in senior debt may wish to consider these bonds’ recovery risk.

  466. BLOG

    Is the US tech sector ignoring minority talent? 

    Oct 1, 2019 Meggin Thwing Eastman , Meggin Eastman

    ESG Research

    Learn More

    Looking in one’s backyard for human capital.

  467. BLOG

    MBS prepayment modeling: AI 1, Humans 0? 

    Sep 27, 2019 Joy Zhang , David Zhang

    Fixed Income , Models/Client Cases , Risk Management

    Learn More

    Artificial intelligence has broken through in fields previously dominated by humans. Could AI surpass humans in modeling the complex risks of agency mortgage-backed securities?

  468. BLOG

    Should bank-loan investors worry about liquidity risk? 

    Sep 24, 2019 László Arany

    Fixed Income , Models/Client Cases , Risk Management

    Learn More

    Have bank loans posed more liquidity risk than corporate bonds when the market was stressed? We compared various liquidity metrics for bank loans and high-yield bonds during the December 2018 high-yield sell-off to find the answer.

  469. BLOG

    Growth’s recent outperformance was and wasn’t an anomaly 

    Sep 20, 2019 Mehdi Alighanbari , Shubhangi Sharma

    Factor Investing , Factor Research Group , Factors

    Learn More

    Growth strategies have outperformed value strategies in recent years. Is growth’s recent performance an anomaly when we look at it in a long-term context? The answer: It depends on what you mean by a growth strategy.

  470. BLOG

    Is climate-change risk all about fossil fuels? Think again. 

    Sep 19, 2019 Michael Disabato

    ESG Research , Global Investing

    Learn More

    When it comes to reducing greenhouse gases, investors tend to focus on fossil fuels and power generation. But other companies also need to adapt to a lower-carbon world. We look at the implications for five types of companies.

  471. BLOG

    Underwater assets? Real estate exposure to flood risk 

    Sep 17, 2019 Gillian Mollod , Will Robson

    ESG Research , Real Estate Investing

    Learn More

    Real estate investors are buying and leasing assets that might be jeopardized by a climate-changed world. A new analysis can help investors identify high-risk U.K. locations.

  472. BLOG

    Are rates and equities losing their balance? 

    Sep 16, 2019 Peter Shepard

    Fixed Income , Models/Client Cases

    Learn More

    For most of the past two decades, a benevolent relationship between bonds and equity has prevailed as a central pillar of asset allocation. Falling equity markets consistently coincided with falling interest rates, providing an effective hedge between bond and equity allocations. Now, talk of weaker central-bank policy or a risk of deflation has many asset allocators focused on the future of the rates-equity correlation. 

  473. BLOG

    Back-to-school (momentum) blues? 

    Sep 13, 2019 George Bonne , Leon Roisenberg

    Factor Investing , Models/Client Cases , Factors

    Learn More

    The U.S. price momentum factor, which we highlighted for elevated crowding scores and vulnerability to negative performance at the end of June, suffered sizable drawdowns in the first seven trading days of September.

  474. BLOG

    Real estate may be yielding less than you thought 

    Sep 12, 2019 Bryan Reid

    Global Investing , Real Estate Investing

    Learn More

    Income has long been an important part of real estate returns meaning yields are often heavily scrutinized by investors. However, headline yields do not factor in capital expenditure requirements which can vary significantly. Investors looking to better understand potential “free cash flow” positions of portfolios post-capex may want to adjust the yields they use to account for it.

  475. BLOG

    MBS investors: quantitative easing déjà vu? 

    Sep 5, 2019 Joy Zhang

    Fixed Income , Risk Management

    Learn More

    Despite the Fed’s silence on the matter, the MBS market may be indicating that a new round of QE is coming.

  476. BLOG

    Using multi-country multi-currency futures in portfolio management 

    Sep 3, 2019 Hitendra D Varsani

    Global Investing , Risk Management

    Learn More

    Investors seeking to more tightly manage their exposures to regional or global benchmarks are turning to multi-country multi-currency futures.

  477. BLOG

    A smoother ride? Looking at factor-based asset allocation 

    Sep 3, 2019 Andrea Amato , Chenlu Zhou

    Factor Investing , Models/Client Cases , Risk Management

    Learn More

    On the surface, holding-based asset allocation appears to produce stability. But is what you see always what you get? We investigate the pros and cons of a factor-based approach.

  478. BLOG

    Looking inside ESG indexes 

    Aug 30, 2019 Meggin Thwing Eastman , Guido Giese , Meggin Eastman

    ESG Research

    Learn More

    Many investors want to stick to their values or beliefs, as well as meet certain financial objectives. How can ESG indexes  help them address these goals?

  479. BLOG

    The last straw: Will plastic become the next stranded asset? 

    Aug 22, 2019 Samuel Block

    ESG Research

    Learn More

    Oil and gas companies are accelerating investment in plastics, in response to the shift away from fossil fuels. But is this pivot sustainable? Could plastic become the next stranded asset?

  480. BLOG

    Where were the (factor) crowds this summer? 

    Aug 21, 2019 George Bonne , Leon Roisenberg

    Factor Investing , Factors

    Learn More

    When factors have historically become crowded, they’ve often experienced significant drawdowns in subsequent months. Which factors were relatively crowded at the end of 2018 — and how did they perform in the first half of 2019?

  481. BLOG

    A reality check for MBS duration risk 

    Aug 15, 2019 Yihai Yu

    Risk Management , Fixed Income , Models/Client Cases

    Learn More

    Empirical duration data can be used to check whether models for mortgage-backed securities are accurately measuring interest-rate risk.

  482. BLOG

    The changing face of real estate portfolios 

    Aug 14, 2019 Bryan Reid

    Global Investing , Real Estate Investing

    Learn More

    Office and retail investments’ historic dominance of commercial real estate portfolios is decreasing, with other property types — including logistics centers, student housing, and data centers — increasing. This evolution highlights how technology and the search for yield have led investors to diversify and seek exposure to other property types.

  483. BLOG

    Liquidity risk under stress: Beyond bid-ask spreads 

    Aug 7, 2019 Diana Knipl

    Fixed Income , Models/Client Cases , Risk Management

    Learn More

    Risk managers at investment funds are more and more focused on liquidity risk, as regulators have recently issued guidance that increases demands for liquidity stress testing. Although markets are currently considered fairly calm, the 2008 financial crisis showed how liquidity can deteriorate quickly under stressed conditions, resulting in widened bid-ask spreads. But by focusing solely on the change in bid-ask spreads, could investors underestimate their liquidity risk? The often-overlooked market impact — or the additional cost on top of the bid-ask cost for large trades — could also increase significantly, driving transaction costs still higher.

  484. BLOG

    Same target, different destinations 

    Jul 31, 2019 Anil Rao

    Integrated Risk Management , Models/Client Cases

    Learn More

    Target-date funds (TDFs) have gained wide adoption in U.S. defined-contribution plans over the last decade, aided by the proliferation of auto-enrollment features and the funds’ presentation as a “set it and forget it” approach.

  485. BLOG

    Have appraisers been too bullish on retail real estate? 

    Jul 30, 2019 Will Robson

    Real Estate Investing

    Learn More

    Media commentary has fixated on the shuttering of shops, while retail-focused REITs are priced at substantial discounts to the value of their assets. Have appraisers of retail real estate been excessively bullish?

  486. BLOG

    Home bias in fixed income: Has it helped or hurt? 

    Jul 29, 2019 Anikó Maráz , Andy Sparks , Maraz Aniko

    Fixed Income , Global Investing , Integrated Risk Management

    Learn More

    Has global diversification historically helped reduce risk in the fixed-income portfolios of U.S. defined-benefit (DB) pension plans? Our backtests show that globalizing bond allocations would have increased risk measured relative to a liability benchmark. For such plans, home bias in bond portfolios would have reduced active risk over the period of our study.

  487. BLOG

    Three scenarios for Fed rate cuts 

    Jul 23, 2019 Andy Sparks , Thomas Verbraken

    Economic Exposure , Fixed Income , Models/Client Cases

    Learn More

    A consensus has emerged that the Federal Reserve will lower rates in the coming months, but investors remain uncertain over the timing and magnitude of the cuts. What impact could three rate-cut scenarios have on markets?

  488. BLOG

    More than a feeling: Quantifying consumer sentiment 

    Jul 17, 2019 Rohit Mendiratta , George Bonne

    Factor Research Group , Factor Investing , Factors

    Learn More

    Among a flood of alternative data sources, consumer sentiment based on citations online stood out.

  489. BLOG

    Is there another Woodford waiting to happen? 

    Jul 11, 2019 Laszlo Hollo

    Global Investing , Risk Management

    Learn More

    When the Woodford Equity Income Fund suspended redemptions on June 3, 2019, it showed how, when a fund’s liquidity profile is misaligned with its shareholder profile and redemption constraints, a single large redemption request can trigger gating. 

  490. BLOG

    Under the hood: Rating ESG funds 

    Jul 10, 2019 Michael Disabato

    ESG Research , Global Investing

    Learn More

    Nearly $31 trillion in assets under management were invested in funds that consider ESG issues in their investing process as of January 2018, a 34% increase from two years previously. Transparency is key to understanding what this expansion means.

  491. BLOG

    Liquidity and correlation in the Chinese credit market 

    Jul 9, 2019 Manuel Rueda

    Fixed Income , Risk Management , Models/Client Cases

    Learn More

    China’s stock market has drawn huge attention from global investors, especially as China A shares have been added to leading equity indexes. But the same cannot be said for the country’s 38 trillion CNY (USD 5.5 trillion) credit market, now the second-largest in the world. Despite the market’s overall size, foreign investor participation remains miniscule, with overseas bondholders accounting for less than 1% of the total holdings.

  492. BLOG

    Asian retail resilience: Have store hours affected performance? 

    Jul 9, 2019 Bryan Reid

    Real Estate Investing , Global Investing

    Learn More

    Industrial real estate has outperformed retail assets in recent years, but the trend has been less pronounced in Asia, where store hours, among other reasons, might have led to more resilient retail performance.

  493. BLOG

    Reverse Convertibles: Worth the Risk? 

    Jul 5, 2019 Gyorgy Kocsis , István Varga-Haszonits

    Risk Management , Models/Client Cases , Fixed Income

    Learn More

    Do reverse convertibles offer any obvious risk-return benefits over high-yield bonds?

  494. BLOG

    Factors in Focus: Dynamic short term, strategic long term 

    Jul 2, 2019 Waman Virgaonkar , Hitendra D Varsani

    Factor Investing , Factor Research Group , Factors

    Learn More

    We review factor performance over the second quarter, provide the perspective of a long-term view and look to indications from our adaptive multi-factor model heading into Q3.

  495. BLOG

    Bank Loans: Will Crisis Follow the Search for Yield? 

    Jun 27, 2019 Hamed Faquiryan

    Risk Management , Fixed Income , Models/Client Cases

    Learn More

    In the post-2008 search for yield, investors have taken on considerable exposure to leveraged bank loans. We assess whether these loans pose systemic risk in the way subprime mortgages did during the last crisis.

  496. BLOG

    Beware of FRTB Cliff Effects. Sharp Curvatures Ahead. 

    Jun 20, 2019 Andras Rokob

    Integrated Risk Management , Fixed Income , Models/Client Cases , Risk Management

    Learn More

    The Basel committee’s revised market-risk capital requirements contain a small surprise with potentially big implications. Cliff effects remain in the framework.

  497. BLOG

    Resilient carbon-transition portfolios: a road map 

    Jun 19, 2019 Dana Sasarean

    ESG Research

    Learn More

    Is your portfolio ready for the transition to a low-carbon economy? Which companies, industries and sectors are positioned to benefit? Which ones entail greater risks? The answers are a lot more complicated than alternative energy is in and coal is out. 

  498. BLOG

    Uber vs. Lyft: Who’s at the Wheel? 

    Jun 18, 2019 Ric Marshall

    ESG Research

    Learn More

    Two companies, one highly disruptive business model, multiple big challenges looming. Few IPOs in recent memory have attracted more attention – or disappointed more decisively, initially – than the IPOs of ride-sharing groups Uber and Lyft. At the end of June 7, 2019, two months following its IPO, Lyft’s share price traded at 17.7% below its IPO price, while Uber’s ended that same day 1.9% lower. Could ESG considerations have played into investors’ thinking?

  499. BLOG

    European securitization at the regulatory crossroads 

    Jun 17, 2019 Miklós Vörös

    Fixed Income , Risk Management

    Learn More

    Have new European Union reforms clouded the future of the securitization market in Europe?

  500. BLOG

    Lessons from Woodford: Shutting the barn door after the horses have bolted 

    Jun 14, 2019 András Bohák , Dimitris Melas , Roman Kouzmenko

    Factor Investing , Factors

    Learn More

    The suspension of the U.K.’s Woodford Equity Income Fund highlights the value of regularly reviewing a portfolio’s factor exposures and liquidity characteristics for signs of style drift or deteriorating ability to redeem shares.

  501. BLOG

    The rise of fundamental factors in China A shares 

    Jun 6, 2019 Oleg Ruban

    Emerging Markets , Factor Investing , Global Investing

    Learn More

    Commonly held perceptions about China A shares have influenced investors to think factor strategies may not work in the Chinese equity markets. Our research suggests this may be changing.

  502. BLOG

    Fed policy, the credit cycle and real estate 

    May 28, 2019 Yihai Yu , David Zhang

    Risk Management , Real Estate Investing , Fixed Income

    Learn More

    Amid the uncertainty over Federal Reserve policy, investors in commercial real estate (CRE) are confronting asset-allocation challenges and growing concerns about CRE valuation and debt levels, after an extended period of easy credit.

  503. BLOG

    What could stress emerging markets? 

    May 24, 2019 Thomas Verbraken

    Global Investing , Risk Management , Economic Exposure , Emerging Markets

    Learn More

    Emerging-market equities and USD-denominated EM sovereign bonds started 2019 with a bang, but recent market turbulence caused by the U.S.-China trade standoff raises a pressing question: What could trigger the next EM downturn?

  504. BLOG

    Beyond headlines: How markets responded to US-China trade talks 

    May 9, 2019 Zhen Wei

    Economic Exposure , Emerging Markets , Global Investing

    Learn More

    Our analysis suggests that changes in equity-market valuations, analysts’ consensus earnings estimates and data on companies’ revenue exposure are metrics that provided insight into recent market and sector performances.

  505. BLOG

    Factor investing in Saudi Arabia: size matters 

    May 7, 2019 Saurabh Katiyar , Neeraj Dabake

    Factor Indexes , Factor Investing

    Learn More

    Foreign interest has risen in Saudi Arabia following the easing of foreign-ownership limits. Our analysis shows investors would have benefited by controlling for exposure to small-cap companies.

  506. BLOG

    Game of Homes: Is winter coming for the domestic-equity bias? 

    Apr 30, 2019 Raman Aylur Subramanian , Anil Rao , Raman Subramanian

    Equity Themes , Models/Client Cases , Global Investing

    Learn More

    Can we quantify home-bias risk in an allocation? And, what has happened when U.S. stocks ended previous multiyear runs of outperformance?

  507. BLOG

    Are You Ready for Uniform MBS? (Part 2) 

    Apr 26, 2019 Yihai Yu

    Models/Client Cases , Fixed Income , Risk Management

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    Aligning prepayment speeds of Fannie Mae and Freddie Mac securities presents a major challenge to the success of uniform mortgage-backed securities (UMBS), which the two government-sponsored enterprises will launch on June 3.

  508. BLOG

    A More politicized Fed? The Market Yawns 

    Apr 16, 2019 Andy Sparks

    Fixed Income , Risk Management

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    Could the Federal Reserve Board (the Fed) become less independent, with political forces exerting more influence?

  509. BLOG

    The Right Tool: How Suitable is Your Real Estate Benchmark? 

    Apr 11, 2019 Amit Nihalani

    Real Estate Investing , Global Investing

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    You don’t have to be a master craftsman to appreciate the benefits of using the right tool for the job. Even the most casual do-it-yourselfer has experienced the frustration of using the wrong screwdriver for a particular job — one that doesn’t quite fit the screw properly and shreds the head, leaving it uselessly stuck in the wood without fixing anything.

  510. BLOG

    Need a Lyft? Why the IPO Blew a Tire 

    Apr 10, 2019 Matt Moscardi , Alan Brett

    Equity Themes , ESG Research , Risk Management

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    A week into the highly publicized IPO for Lyft Inc., the ride-sharing company, it’s hard to say it went exactly as planned.

  511. BLOG

    Are You Ready For Uniform MBS? (Part 1) 

    Apr 8, 2019 Yihai Yu

    Models/Client Cases , Fixed Income , Risk Management

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    Fannie & Freddie will conclude Single Security Initiative (SSI) June 3, 2019, creating a single to-be-announced (TBA) market & a new TBA security: the uniform mortgage-backed security (UMBS)

  512. BLOG

    What Yield-Curve Inversions Have Meant For Markets 

    Apr 5, 2019 Alfredo Bequillard

    Equity Themes , Economic Exposure , Fixed Income

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    Inversion of the yield curve has historically been a reliable indicator that a recession is coming. But what has it implied for stock prices and Treasury rates?

  513. BLOG

    Evaluating the Impact of LIBOR Fallback 

    Apr 3, 2019 Maks Oks

    Fixed Income , Global Investing , Integrated Risk Management

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    The planned discontinuation of LIBOR and other interbank offer rates sometime in 2022 will affect a large number of existing financial contracts based on these benchmarks.

  514. BLOG

    Factors in Focus: Risky start. Quality finish. 

    Apr 2, 2019 Waman Virgaonkar , Hitendra D Varsani

    Factors , Global Investing , Factor Investing

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    We highlight the fast-moving rotation among factors that continued during Q1 2019. As we move into Q2 2019, this framework showed allocation changes in different factors.

  515. BLOG

    Saudi Arabia inclusion and emerging markets 

    Mar 28, 2019 Saurabh Katiyar

    Equity Themes , Emerging Markets , Global Investing

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    Saudi Arabian stocks will be included in the MSCI Emerging Markets Index and the MSCI ACWI Index in a two-step process starting in June this year. With the first step of inclusion of the MSCI Saudi Arabian Index coming shortly, we ask how inclusion of this Middle Eastern market would have affected the MSCI EM Indexes.

  516. BLOG

    Have High-Yield ETFs Created Liquidity Risk? 

    Mar 27, 2019 Reka Janosik

    Fixed Income , Risk Management , Integrated Risk Management

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    In the fourth quarter of 2018, redemptions of high-yield ETFs soared to approximately 25% of these funds’ assets under management (AUM), according to data provider IHS Markit.

  517. BLOG

    A New Day for Monetary Policy? 

    Mar 22, 2019 Andy Sparks

    Emerging Markets , Fixed Income , Global Investing

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    Listen as MSCI’s Andy Sparks discusses potential implications of the US Federal Reserve’s sharply softening monetary policy, and whether the role of central banks has changed.

  518. BLOG

    Don’t confuse capital growth and asset-value growth 

    Mar 21, 2019 Niel Harmse

    Economic Exposure , Real Estate Investing , Global Investing

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    Measuring real estate growth is not a simple exercise; we run through it highlighting some common confusions

  519. BLOG

    Factors and ESG: The Truth Behind Three Myths 

    Mar 20, 2019 Guillermo Cano

    Models/Client Cases , ESG Research , Factor Investing

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    There are misconceptions of the relationship between factors and ESG issues. We debunked three common myths about ESG, momentum, quality and smaller-cap stocks.

  520. BLOG

    Santander’s Coco extension: The New Market Norm? 

    Mar 18, 2019 Imre Vörös , Gergely Szalka

    Models/Client Cases , Fixed Income , Risk Management , Integrated Risk Management

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    Banco Santander announced it would extend — i.e., not call — its additional-tier-one contingent-convertible (coco) bond. Was the market caught off guard?

  521. BLOG

    The Risk in Risk-Parity Strategies 

    Mar 13, 2019 Thomas Verbraken

    Fixed Income , Integrated Risk Management

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    The relationship between bonds and equities may be especially important to investors who employ a risk-parity approach. In our analysis, as the bond-equity correlation turned strongly positive, the effect on risk-parity portfolios was much greater than that on traditional 60/40 equity/bond portfolios.