Extended Viewer

Stuart Doole

Stuart Doole
Managing Director, MSCI Research

About the Contributor

Stuart Doole is Managing Director and Global Head of Index New Product Development Research. He leads a global team responsible for developing new indexes and enhancing existing products. Previously, he worked on both the buyside, in portfolio management, investment research and risk management, and the sell-side, producing top-down macro and bottom-up quantitative research. Stuart has a BA and a DPhil in Mathematics from Oxford University and an MSc in Nonlinear Mathematics from Bath University.

HTML Displayer Portlet

Contributions by Stuart Doole

Extended-lister

Nothing was found.
  1. 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?

  2. 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.

  3. PAPER

    Aligning Portfolios with the Paris Agreement 

    Oct 26, 2020 Stuart Doole , Kumar Neeraj , Véronique Menou

    Investing (Investment Management)

    Download Document

    The pressure on institutional investors to act on climate change and demonstrate its influence on their decision-making and portfolio construction continues to grow. Increasingly, the focus is on the alignment of client investment strategies with the decarbonization pathways required to deliver the global 1.5oC increase targeted by the Paris Agreement.

    This alignment may be achieved by overweighting companies on a credible path to decarbonization or offering green solutions, while in contrast underweighting those poorly positioned for the transition to a lower-carbon economy and by limiting exposure to the growing physical risks. Investors tackling this investment challenge are now supported by the MSCI Climate Paris Aligned Indexes.

  4. BLOG

    与《巴黎协定》保持一致:一种基于指数的方法 

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

    Learn More

    由于需要根据《巴黎协定》的目标使投资策略与将全球升温限制在 1.5oC 所需的脱碳途径相一致,投资者承受着越来越大的压力。

  5. 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.

  6. 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.

  7. Thematic investing is a top-down approach that has become increasingly popular with both institutional and retail investors, whether in terms of investment philosophy or product development. In this paper, we review the concept of thematic investing and discuss the differences between it and the factor and ESG investment processes. We then lay out how we model various themes in order to build a rule-based index methodology that represents the performance of companies exposed to a certain trend.

  8. A transition to a low-carbon economy could reduce demand for carbon-intensive products and services in favor of low-/zero-carbon counterparts. This migration in demand could also alter the risk-return profile — not only of individual companies but of some entire industries. The MSCI Climate Change Index aims to reflect these potential changes, increasing the index weight of companies identified as exposed to a low-carbon transition, while decreasing the weight in companies negatively exposed to such changes, while seeking to maintain broad market exposure.

  9. BLOG

    What drives the capacity of factor index strategies? 

    Oct 30, 2018 Stuart Doole

    Factor Indexes , Factors , Factor Investing

    Learn More

    As factor investing becomes increasingly “business as usual,” institutional investors have become keenly interested in the ability of strategies that replicate factor indexes to persistently capture desired exposures without compromising exposure to the target factor. We illustrate six index design approaches that can be used to tackle this challenge.

  10. Making allocations to individual factors typically requires strong investment beliefs, as factor returns have been cyclical in nature. When weighing the pros and cons of different multi-factor indexed approaches, institutional investors often evaluate both bottom-up or top-down options. We consider the attractions of both, using a bottom-up approach to build a multi-factor index from stocks that are favorably exposed to the value, size, quality and momentum factors, compared with an alternative top-down approach combining single factor indexes. We compare the two approaches in terms of their level of exposure to the target factors as well as their capacity and investability profiles.

  11. As the more alarmist discussion of factor meltdowns due to crowding has dissipated, institutional investors have turned toward understanding the investment capacity of factor-based strategies. The key question is to gauge how much capital can be invested in funds that replicate factor indexes before their return expectations diminish to unattractive levels. In this Research Insight, we use characteristics of factor indexes to gauge their capacity, using the MSCI Minimum Volatility Index as a case study. Our analysis suggests practical ways that factor investors can modify their strategies to reduce their factor footprint, without affecting their ability to capture the desired factor exposure.

  12. Institutional investors are moving toward integrating ESG criteria into their portfolios and their factor allocations in particular. But they face key challenges in doing so: How can they enhance their strategies’ ESG profiles while achieving the desired exposure to their target factors? Our research shows this can be achieved by simultaneously incorporating ESG integration alongside factor exposure targeting in index construction. The MSCI Factor ESG target indexes’ “one-step” approach achieved significant improvement of the ESG profile of a single- or multi-factor index relative to its market-cap-weighted parent with modest or no negative impact on the indexes’ ability to capture factor return premia over the December 2007 to June 2017 study period.

  13. BLOG

    Integrating ESG criteria into factor index construction 

    Sep 27, 2017 Stuart Doole

    Factor Indexes , ESG Research , Factors , Factor Investing

    Learn More

    Institutional investors increasingly are moving toward integrating ESG criteria into their portfolios and their factor allocations, in particular. This shift is driven by their recognition of the financial relevance of ESG issues to their risk management and their focus on long-term sustainable investing.

  14. PAPER

    KEEP IT BROAD: AN APPROACH TO ESG STRATEGIC TILTING 

    Feb 8, 2017 Laura Nishikawa , Stuart Doole , Kumar Neeraj , Véronique Menou

    Download Document

    HOW CAN UNIVERSAL OWNERS INTEGRATE ESG PRINCIPLES WHILE MAINTAINING A BROAD AND DIVERSIFIED INVESTMENT UNIVERSE?

    Institutional investors are increasingly looking for ways to integrate ESG considerations into their investment decisions. By doing so, they may aim to mitigate long-term risks, generate higher risk-adjusted performance and/or align investments with broader societal objectives. As ESG investment guidelines become more commonplace among asset owners, and as many continue to build capabilities in engagement and risk management, we have seen a small but growing set of institutional investors focus on long-termism by adopting investment strategies that explicitly build in their holistic views of the future.

  15. In the past, institutional investors largely ignored currency hedging in their international equity portfolios. With the globalization of the equity portfolio and recent market volatility, they no longer can afford to do so. However, how to hedge foreign-exchange exposure is receiving renewed scrutiny. Static hedges have delivered higher risk-adjusted returns compared with unhedged portfolios over a long-term horizon. The static hedge, however, faces challenges in adapting to changing market regimes. A dynamic approach that uses systematic signals such as Value, Momentum, Carry and Volatility delivered better risk-adjusted returns than traditional static hedge methods in our sample period, offering a new approach for volatile markets.

  16. Global equity portfolios expose investors to currency risk. Those wishing to minimize currency effects often hedge that currency exposure without touching their underlying international equity portfolios. However, currency fluctuations may also increase the investment returns and those movements can be sharp. We describe how the MSCI Adaptive Hedge Indexes use versions of four well-known currency indicators – Value, Momentum, Carry, and Volatility – to systematically determine a level of hedging for each currency exposure in the index. We also explain how the input from the four indicators has historically changed in response to volatile market conditions or a more challenging macro environment.

  17. PAPER

    Research Insight - Constructing Low Volatility Strategies - January 2016 

    Jan 25, 2016 Lokesh Mrig , Stuart Doole , Durga Shankar , Mehdi Alighanbari

    Factor and Risk Modeling , Investing (Investment Management) , Portfolio Construction and Optimization

    Download Document

    Low volatility is one of the few factors that have historically performed well in turbulent markets. Moreover, over long periods of time, this defensive strategy has produced a premium over the market, contravening one of the most basic theories in finance — that one should not be rewarded with greater returns for taking less than market risk. Since the global financial crisis hit in 2008, low volatility has garnered increased attention from institutional investors. In this paper, we explore both rules-based and optimization-based approaches to constructing low volatility strategies.

  18. PAPER

    Research Spotlight - Raising Minimum Governance Standards - Selecting Quality Companies for the Long Term 

    Dec 7, 2015 Stuart Doole , Kumar Neeraj , Ric Marshall

    Investing (Investment Management) , Portfolio Construction and Optimization , Responsible Investing

    Download Document

    Institutional investors concerned with excessive focus on short-term results are increasingly seeking to improve minimum corporate governance standards of their portfolio companies. To date, active engagement has been widely recognized as an effective means to promote sustainable long-term growth and risk management of a portfolio, but such approaches can be costly and difficult to scale. We put forward a potential approach for institutional investors to systematically raise minimum governance standards for portfolio companies by taking quality metrics — an established approach of gaining exposure to companies with enduring business models —  and overlaying them with non-financial corporate governance criteria.  In this Research Spotlight, we provide a concise version of our full-length Research Insight, Raising Minimum Governance Standards - December 2015.

  19. PAPER

    Research Insight - Raising Minimum Governance Standards - December 2015 

    Dec 7, 2015 Ric Marshall , Stuart Doole , Kumar Neeraj

    Investing (Investment Management) , Portfolio Construction and Optimization , Responsible Investing

    Download Document

    Institutional investors concerned with excessive focus on short-term results are increasingly seeking to improve minimum corporate governance standards of their portfolio companies. To date, active engagement has been widely recognized as an effective means to promote sustainable long-term growth and risk management of a portfolio, but such approaches can be costly and difficult to scale. We put forward a potential approach for institutional investors to systematically raise minimum governance standards for portfolio companies by taking quality metrics — an established approach of gaining exposure to companies with enduring business models —  and overlaying them with non-financial corporate governance criteria.

  20. PAPER

    Research Spotlight - Lost in the Crowd? Identifying and Measuring Crowded Strategies and Trades 

    Jun 26, 2015 Stan Radchenko , Stuart Doole , Mehmet Bayraktar , Altaf Kassam

    Factor and Risk Modeling , Investing (Investment Management) , Portfolio Construction and Optimization , Risk Management , Asset Pricing and Valuation

    Download Document

    The “quant meltdown” of 2007 and the subsequent global financial crisis highlighted the risks of crowded investment strategies. The recent growth of “smart beta” indexes and their use in ETFs has added to concerns about crowding. In this Research Spotlight, we explore the risks posed by crowded strategies and explain how the MSCI Crowding Scorecard enables asset managers to assess these risks as they exist in today’s markets. The Scorecard employs four metrics that can help managers understand the risks of overlapping trading strategies, which may not be apparent by focusing on a single metric alone.

  21. AUTHORS: Mehmet K. Bayraktar, Stuart Doole, Altaf Kassam, Stan Radchenko

    The “quant meltdown” of August 2007 and the subsequent unfolding of the global financial crisis highlighted the risks of crowded investment strategies. The rapid growth of smart beta indexes and their use in ETFs has added to the need for scrutiny. In this Research Insight, we propose a set of four key metrics (our “Crowding Scorecard”) for monitoring and detecting the crowding risk of any particular investment strategy, building on our innovative analysis of historical behaviors of investment strategies and the MSCI equity risk models incorporating Systematic Equity Strategies (SES).
     

  22. PAPER

    Sectoral aspects of global infrastructure investment 

    Jun 15, 2015 Abhinav Sharma , Peter Hobbs , Anthony Francesco , Stuart Doole , Brent Mcelreath

    Download Document

    As the MSCI Global Quarterly Infrastructure Asset Index grows in breadth and depth it provides increasing insights into the performance of the Infrastructure Asset Class, globally.  In this Research paper, we focus on two broad areas related to sector-specific nuances of the asset class. First, the differential performance and volatility of the Transport and Power sectors, the two dominant streams of activity in the index.  Second, a comparison of unlisted and listed infrastructure, showing that many of the performance differences between the two indices can be explained by sector weighting.  By matching the quarterly sector weights in the unlisted index to create a listed proxy, we see strong evidence that sectoral composition go a long way to explaining differential performance patterns of the underlying indexes.

  23. PAPER

    Research Spotlight - The MSCI Diversified Multi-Factor Indexes 

    May 27, 2015 Padmakar Kulkarni , Dimitris Melas , Stuart Doole , Chin Ping Chia

    Download Document

    Multi-factor indexes are important tools for institutional investors seeking diversified exposure to factors that have historically generated premia over long horizons. In this Research Spotlight, we examine the new MSCI Diversified Multi-Factor (DMF) Index family, which selects stocks with exposures to the value, momentum, quality and low size factors, while keeping risk at the level of the market.

  24. PAPER

    Research Insight - MSCI DIVERSIFIED MULTIPLE-FACTOR INDEXES 

    May 7, 2015 Padmakar Kulkarni , Stuart Doole , Chin Ping Chia , Dimitris Melas

    Download Document

    Maximizing Factor Exposure While Controlling Volatility

    May 2015

    Multi-factor indexes are important tools for investors seeking diversified exposure to factors that have historically generated premia over long horizons.  In this Research Insight, we examine the new MSCI Diversified Multiple-Factor (DMF) Index family. These indexes combine four well-researched factors — value, momentum, size and quality — with a control mechanism designed to keep volatility close to the level of the market. We find that the DMF approach historically has allowed for efficient index construction by capturing the intended factor exposures and handling investor constraints. By optimizing exposures, these multi-factor indexes have produced high, persistent and controllable factor exposures from a focused selection of stocks.

Regulation