From Top-down Beta Management to Bottom-up Analyst Sentiment

Investors entered the third quarter having experienced the worst start to a year since 1975. A bear market rally materialized, and investors chased stocks with high beta (relative to low beta). However, the acceleration in U.S. annual core inflation to 6.3% in August led to a sharp downturn in the performance of high-beta stocks, while energizing momentum stocks.

Mark Carver, Hitendra Varsani and Abhishek talk about the performance of style factors and industry groups, and the historical performance of high- vs. low-beta stocks.

Knowing investors are assessing the importance of top-down considerations versus bottom-up analysis even more intently than usual, our experts also discuss the analyst sentiment factor and its relationship with global-equity performance.