MSCI in Practice: Are Stock Bubbles Rising?

We are pleased to continue our MSCI in Practice series to bring you actionable insight to help build better portfolios. On March 10, 2021, we present: Are Stock Bubbles Rising? 

Many investors may choose to simply avoid crowded or bubbly stocks altogether. But knowing which companies are most similar to the crowded ones may be valuable to compare the behavior and characteristics of a crowded stock to its peers before deciding whether to replace or liquidate. 

During this webinar we propose a framework that allows one to assess the “bubbliness” of stocks and portfolios. We believe that bubbles are largely driven by the same forces, and can be identified by the same characteristics, as crowded trades, a topic we have researched extensively at the factor level. 

Agenda topics

• Crowding framework: Metrics used to quantify bubbles and crowding in stocks
• The security-level crowding model in action: MicroStrategy and GameStop case study 
• Using news sentiment and options trading activity as indicators of stock crowding

Click here to view the recording.