Perspectives on industry challenges and opportunities affecting you and your clients.
The Knowledge Center is your source for perspectives on industry challenges and opportunities affecting you and your clients. Below are materials from SEI's Investment Management Unit. For industry-specific thought leadership, please visit the following sections:
Video: Q3 2014 Global Economic Market ReviewOct152014Article
Concerns about the magnitude and timing of an interest rate hike in the U.S. combined with geopolitics and global growth concerns to push market volatility higher.
Central Bank Policy Shifts Highlight Diverging Bond YieldsSep182014Article
After half a decade of tepid economic recovery marked by low and generally falling bond yields, we are finally seeing some divergence.
Monthly Market Commentary - 2014 AugustSep92014Article
Economic expansion continued to unfold at disparate paces across developed markets. New data showed signs of shifting growth trajectories, putting pressure on central banks to modify current levels of accommodation. Fixed-income and equity markets fared better in August than during the prior month. Corporate bonds led other fixed-income segments and the Americas outpaced other regions for equity performance. Even with somewhat elevated developed-market equity valuations and narrow credit spreads, we see room for markets to move higher and would be inclined to buy on a correction
Behavioural Finance: Rules of Thumb and RepresentativenessJul302014Article
In Behavioural Finance: An Introduction to Human Error, we noted that Kahneman and Tversky were smart academics who found many ideas for their social science experiments in the mistakes that they themselves made as well as the mistakes that their intelligent colleagues and subjects made. Kahneman and Tversky noted some rules of thumb that often lead investors astray.
Annual Market Commentary - Second Quarter 2014Jul282014Article
Economies around the world continued to show signs of improvement in the third quarter of 2013, overcoming market volatility around the U.S. Federal Reserve’s next moves, the possibility of military intervention in Syria (in the early part of the quarter) and on-going woes in emerging markets. While positive developments were most notable in the U.S. and Japan, Europe also witnessed some signs of stabilisation and the U.K. appeared to be on an unexpectedly strong growth trajectory.
The Ongoing Conflict in Eastern UkraineJul232014Article
The situation in eastern Ukraine has continued to deteriorate, and resolution remains a long way off. It’s not yet clear if the recent downing of a civilian aircraft will serve to escalate or de-escalate the conflict. Our Funds remain well diversified, and both SEI and its managers are watching developments closely.
Second Quarter 2014 Market and Performance UpdateJul122014Article
Uneven worldwide economic growth has resulted in global monetary policy at various stages of ebb and flow. Global inflation may begin to weigh on accommodative central banking. Most developed-market equities continue to see earnings growth. A turnaround in Europe is one of the keys to global market performance in the months ahead.
May 2014 Monthly Market CommentaryJun52014Article
Economic growth showed measured improvement globally, and inflation remained below target in most regions. Most major bond markets—U.S., U.K., Japan and the eurozone—saw government bond yields fall, while global equity markets were again positive. While not as robust early in 2014 as they were last year, we believe equities have held up quite well in the face of political tensions and emerging-market growth concerns.
Quarterly Market Commentary - First Quarter 2014Apr92014Article
•Optimism continued in advanced economies, while emerging economies faced multiple challenges
•Easing of inflation pressures around the world should keep global monetary policies accommodative.
•Global equities reached positive territory by quarter end, while fixed income gained as interest rates generally fell.
An Economic Thaw, but a New Cold WarApr82014Article
Global stock markets bounced higher following a brief dip in the latter part of January, with the U.S. leading the way. The ability of equities to quickly overcome periodic stumbles (in the U.S. and other developed markets, at least) underscores investors’ willingness to assume risk even when economic and geopolitical uncertainties are on the rise. The fact that developed market equity pullbacks remain brief and shallow suggests that the rotation out of cash and fixed-income assets and into stocks is still very much in play.
January 2014 Monthly Market CommentaryFeb102014Article
The monetary policies of global central banks remain accommodative and are expected to continue as such, while global growth builds momentum. Concerns related to the U.S. Federal Reserve tapering of bond purchases, sustainability of corporate profits and Chinese output resulted in a pullback in global equities, while global fixed income gained. SEI does not believe the elements of a more serious equity bear market are in place. The most important drivers of stock-market performance in our framework are still flashing neutral-to-positive signals.
Concerns surrounding the pace of Chinese growth, the impact of reduced quantitative-easing stimulus and the health of corporate earnings culminated in a sudden shift of investor sentiment last week. SEI is maintaining its favourable view of emerging equities, as we believe catalysts will materialise that should improve the outlook for the asset class. While emerging and developed equities have struggled out of the gate in 2014, we do not believe the elements of a more serious equity bear market are in place.
November 2013 Monthly Market CommentaryDec62013Article
Accommodative monetary policies by most global central banks remain in place, with the European Central Bank taking additional steps to aid the eurozone’s recovery. Global fixed-income markets dipped, with emerging market debt retreating much more than investment-grade bonds. Global equities generally gained, led by the traditional growth sectors of health care, information technology and consumer discretionary.
Risk Parity: The ConceptSep32013Article
Investors are typically counselled to diversify capital across asset classes in an effort to reduce risk. In light of this, it could be something of a surprise to learn just how concentrated a traditionally diversified portfolio may be in terms of its sources of risk.
Investment Fundamentals: Bond Market MathsAug72013Article
In recent years, global central banks have kept interest rates low in an effort to support the struggling global economy. Since hitting multi-generational lows, interest rates (and bond yields) have spiked significantly higher.
April 2014 Monthly Market CommentaryArticle
Economic growth remained mixed across the globe, and inflation was tame in most regions. Most major bond markets—U.S., U.K., Japan and the eurozone—experienced a modest decrease in government bond yields. Global equity markets showed impressive resilience and were again positive. Global equity markets have not been as robust early in 2014 as they were last year, but we believe they have held up quite well in the face of political tensions and emerging-market growth concerns.